Question

What is marginal cost? Provide a definition in your terms.

Now, give an example/situation where the marginal cost would go from low to high in an engineering economics situation.

Answer 1

Marginal cost is nothing but the cost of producing one additional product. One example where marginal cost would go from low to high in an economic situation is when the machinery is getting worn-out continuously and additional capacity is used where the fuel and electricity in the missionary would take would be more than before as a result of which the marginal cost would continue to increase for producing one extra product and this is an engineering economics example where marginal cost would increase.