Question

Explain how marginal cost is influenced by variable costs alone and not by fixed costs.​

Answer 1

Answer:

Fixed costs do not affect the marginal cost of production since they do not typically vary with additional units. Variable costs, however, tend to increase with expanded capacity, adding to marginal cost due to the law of diminishing marginal returns.

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Answer 2

Answer:

Fixed costs do not affect the marginal cost of production since they do not typically vary with additional units. Variable costs, however, tend to increase with expanded capacity, adding to marginal cost due to the law of diminishing marginal returns.