Question

Salubre Pharmaceuticals invested $3.4 billion dollars to develop a new drug for individuals with diabetes. After Salubre receives FDA approval of the drug, its marginal cost to produce the drug for market will be:a. lowb. highc. modrated. unpredictable

Answer 1

Answer:

The correct answer is letter "A": low.

Explanation:

The marginal cost of a company represents the cost of producing one more additional unit. For knowledge-intensive industries such as pharmaceuticals that require clearance from the Food and Drug Administration (FDA), investment for research, development and to produce drugs is high, but once the drugs are already in production the marginal cost tends to be low.