ABC Ltd. is considering increasing the production level . What is the approximate marginal cost of increasing production form its July level of 40 units to 41 units?
A
160
B
150
C
130
D
110
Correct Answer: 130
The variable cost at 40 units production is 4000 and at 46 units is around 4800 – the graph is almost a straight line between these two points. Thus the marginal cost of increasing production from 40 units = 8006 = 130approximately.