Multiple choice

Which of the following doesn't enter into marginal cost?

  1. Direct cost

  2. Fixed cost

  3. Prime cost

  4. Variable cost
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Marginal cost is the change in total cost that arises when the quantity produced is incremented by one unit. Fixed costs do not change with the level of output, so they are excluded from marginal cost calculations.

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