Respuesta :
1. If the marginal cost outweighs the marginal cost, consider stepping up a project, activity, or output.
2. halt the process at, or as near to, the point where the marginal gain equals the marginal cost.
3. Stay away from projects where the marginal cost is greater than the marginal cost. When contrasting several public project proposals, you should adhere to these rules.
The costs that are incurred in addition to the base cost while manufacturing more units of an item or service are referred to as marginal costs. It is computed by dividing the entire change in production costs by the change in the volume of items produced.
Labor and materials, as well as any anticipated increases in fixed costs like administrative, overhead, and selling expenses, are typically included in the calculation of variable costs. The generation of cash flow can be optimized through financial modeling by using the marginal cost formula.
The Marginal Cost Formula is:
Marginal Cost = (Change in Costs) / (Change in Quantity)
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