Question

True or False: Marginal analysis involves comparing the additional or extra benefit derived from consuming an additional unit of a product or service to the additional cost of consuming that unit of the product or service.

Answer 1

Answer:

True

Explanation:

Marginal - the dictionary meaning of such word is additional of anything. Here, in the given case, marginal analysis as per costing is the analysis of each additional revenue from each additional sale or production.

Marginal analysis does not consider fixed cost generally, as that is fixed and don not add on on additional units, within a standard range.

Thus, the statement stated here is True.