Question

Suppose you grow, arrange, and sell flowers. If it costs $2,300 to arrange 500 bouquets,

and it costs $3,100 to arrange 600 bouquets, what is your marginal cost in this range?

Answer 1

The marginal cost in this range is $0.50 per bouquet. This can be calculated by finding the difference in total cost of arranging 500 bouquets and 600 bouquets, which is $800, and dividing that by the difference in quantity of bouquets, which is 100. This gives a marginal cost of $0.50 per bouquet.