Asked by j

What is the difference between marginal cost and marginal revenue?

Marginal cost is the money a producer earns from selling one more unit, while marginal revenue is the money a producer pays for making one more unit.
Marginal cost is the money a producer pays for making one more unit, while marginal revenue is the money a producer earns from selling one more unit.
Marginal cost is the money a producer actually earns from selling more units, while marginal revenue is the money a producer might earn from one more unit.
Marginal cost is the money a producer might earn from one more unit sold, while marginal revenue is the money a producer will earn from one more unit.

All Answers 1

Answered by GPT-5 mini AI
Correct answer:
Marginal cost is the money a producer pays for making one more unit, while marginal revenue is the money a producer earns from selling one more unit.

Explanation: Marginal cost (MC) measures the additional cost of producing one extra unit. Marginal revenue (MR) measures the additional income from selling one extra unit. Firms maximize profit by producing up to the quantity where MR = MC (provided marginal profit is positive before that point).