Question

Samantha is evaluating whether to increase production at her book bindery. If she hires one more worker, she can increase output by 50 books per week. A book binder’s weekly wage is $250. Samantha’s marginal cost of increasing output by 50 books per week is ________.

Answer 1

Answer:

The marginal cost for hiring a single book binder is $50

Step-by-step explanation:

Marginal cost is best known as the incremental costs incurred when producing additional units of a good or service. This is derived by taking the total change in the cost of producing more goods

and dividing it by the change in the number of goods produced.

What is “Change in Quantity”?

In simple terms,it is an increase or decrease in the volume of goods produced.

Samantha hired an extra employee that subsequently increased her output by 50 which is also incurred an extra $250 dollar to the wages of the employee.

Therefore Samantha's marginal cost will be :

cost/output which is 250/50=$5

Answer 2

Answer:

Samantha's marginal cost of increasing output by 50 books per week is $5

Step-by-step explanation:

Marginal cost is given as change in cost divided by change in quantity produced

change in cost (weekly wage) = $250

change in quantity produced weekly = 50 books

Marginal cost = $250 ÷ 50 = $5

Her marginal cost is $5 per week