Question

If the total cost of producing 300 leather jackets is $400 and the total cost of producing 301 leather jackets is $435, what is the marginal cost of production at 300 leather jackets?


$400


$35


$835


$435

Answer 1

The marginal cost of production is the additional cost incurred to produce one more unit of a good. In this case, the cost of producing 300 leather jackets is $400, and the cost of producing 301 leather jackets is $435.

To find the marginal cost of producing the additional jacket:

\[ \text{Marginal Cost} = \text{Cost of producing 301 jackets} - \text{Cost of producing 300 jackets} \]

\[ \text{Marginal Cost} = 435 - 400 = 35 \]

So, the marginal cost of production at 300 leather jackets is **$35**.