Moving Along a PPF, Marginal Cost Is

question 95

Multiple Choice

Moving along a PPF, marginal cost is

• A) the cost of producing the first unit of a good or service.
• B) equal to the opportunity cost of producing one more unit of a good or service.
• C) the total cost, less the production of the other good or service.
• D) greater than the opportunity cost.

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Definitions:

Depreciation Expense

An accounting method to allocate the cost of a tangible asset over its useful life.

Residual Value

The estimated salvage value of an asset at the end of its useful life.

Depreciable Cost

The original cost of an asset less its salvage value, representing the total amount that can be depreciated over its useful life.