Marginal Private Cost

question 290

Multiple Choice

Marginal private cost

• A) is always zero if there is an external cost.
• B) equals the marginal social cost only if the marginal external cost is positive.
• C) is the cost of producing an additional unit of a good or service that is paid by the producer of that good or service.
• D) the cost of producing an additional unit of a good or service that falls on people other than the producer of that good or service.
• E) the cost of producing an additional unit of a good or service that is paid by the entire society.

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Definitions:

Materials Requisitions

Documents or electronic requests used in manufacturing to authorize the release of materials from inventory for production.

Job Order Cost Accounting

A cost accumulation and assignment method, specifically used for tracking and reporting costs for each individual job or project separately.

Manufacture

The process of converting raw materials or components into finished goods through the use of labor, machinery, tools, and chemical or biological processing.

Indirect Materials

Materials used in the production process that are not directly traceable to the finished product.