Marginal Cost Calculation for Vanessa's Necklace Business

What is Vanessa's marginal cost for making one necklace?

Is it $29.00, $54.00, $4.00, or $8.00?


The correct answer is $4.00.

Vanessa's marginal cost for making one necklace is $4.00. This can be calculated by finding the difference in total cost between making 10 necklaces and making 11 necklaces.

When she makes 10 necklaces, it costs her $25, which means the cost per necklace is $2.50 ($25 / 10 = $2.50). When she decides to make 11 necklaces, the total cost becomes $29.00. The additional cost for making one more necklace can be calculated by subtracting the cost of making 10 necklaces from the cost of making 11 necklaces, which is $29 - $25 = $4.

Therefore, Vanessa's marginal cost of making one necklace is $4.00.

← Please some help ap macro economics Exploring the boundaries of existence →