ECONOMICS
ENTREPRENEURS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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True
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False
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Either A or B
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None of the above
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Detailed explanation-1: -Under marginal costing, the selling price is fixed based on contribution. In case of cost plus contract, it is very difficult to fix price. It does not explain the reason for the increase in production or sales.
Detailed explanation-2: -Marginal cost is the cost associated with producing one additional unit of a product or service. It is calculated by taking the total cost of producing a certain quantity and subtracting the cost of producing the previous quantity.
Detailed explanation-3: -The correct answer is: B. Marginal Cost is the incremental cost of one unit. Reason: Marginal cost is the additional cost incurred in producing one extra unit of output.
Detailed explanation-4: -Marginal cost is the expense incurred by a business for producing an additional unit of a good or service. It is calculated by taking the total cost of producing additional products and dividing it by the total number of extra units produced.