What is Marginal Cost

Marginal cost is change in total cost when we produce one more unit. If you will produce one more unit, you will see change in the total cost. It may be decrease or increase and this change will be marginal cost. In short form, we say it as MC.

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Relationship between Average Cost Marginal Cost and Total Cost

Following observations with regards to the relation between average cost and marginal cost. We divide this relationship into two parts. a) Relationship of average cost and marginal cost and b) relationship of total cost and marginal cost.

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Cost and its Main Concept Given in Micro Economics

Definition of Cost

Cost means all expenses which incurred for production and operation of business. Cost is importance because without calculating of cost, price of any product can not be calculated. Cost provides the information what price will be fixed after adding some margin. But in Cost accounting and economics, this concept is so important and a student of commerce should now every terms used in cost. After this he will able to calculate the price and making other cost policies to reduce cost and increase revenues.

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Why is the Marginal Cost curve “U” shaped?

Definition of Marginal Cost

Alfred Marshall invented the famous economics word marginal, it means, one more unit. If we produce one more unit of product, the changes in total cost are called marginal cost. The formula of marginal cost is

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