2.4 Profit

Question 16 • 2102320-Economics HONORS - Edgenuity Teacher

What is the difference between marginal cost and marginal revenue?

Answer

Marginal cost is the money earned from selling one more unit of a good. Marginal revenue is the money paid for producing one more unit of a good.

Marginal cost is the money paid for producing one more unit of a good. Marginal revenue is the money earned from selling one more unit of a good.

Marginal cost is the money a producer might make from one more unit. Marginal revenue is the money a producer actually makes from one more unit.

Marginal cost is the money a producer actually makes from one more unit. Marginal revenue is the money a producer might make from one more unit.

Explanation

Marginal cost is the additional cost of producing one more unit, while marginal revenue is the additional money earned by selling one more unit. Choice B gives these definitions correctly: money paid for producing another unit is marginal cost, and money earned from selling it is marginal revenue.

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1.7 Comparative and Absolute Advantage