(Table: Costs of Birthday Cakes) Use Table: Costs of Birthday Cakes.Assume that fixed costs are $10.What is the marginal cost of the second cake?

A) $5
B) $10
C) $25
D) $35

Question

(Table: Costs of Birthday Cakes) Use Table: Costs of Birthday Cakes.Assume that fixed costs are $10.What is the marginal cost of the second cake?A) $5B) $10C) $25D) $35

Julissa Romero · Accepted Answer

Final Answer : B, Explanation :  To calculate the marginal cost of the second cake, we need to look at the difference in cost between the first and second cake. The cost of the first cake is $20, and the cost of the second cake is $30. Therefore, the marginal cost of the second cake is  $30 - $20 = $10. Since the fixed costs are already accounted for, the additional cost incurred to produce the second cake is equal to the marginal cost. Therefore, the best choice is B.

(Table: Costs of Birthday Cakes) Use Table: Costs of Birthday Cakes.Assume that fixed costs are $10.What is the marginal cost of the second cake?

A) $5
B) $10
C) $25
D) $35

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