marginal cost
Extra unit's price
Marginal cost is the additional expense of producing one more unit of something.
In economics, it's the cost of increasing output by a single increment: The marginal cost of the tenth widget is lower than the first because fixed costs are spread wider.
Businesses compare marginal cost to marginal revenue to determine optimal production levels.
Charging varied amounts per buyer
- profit maximizationPursuing greatest possible gains
- markupAdded percentage for profit
- price settingDetermining sale amounts
- demand curveGraph of price versus quantity
supply curve · elasticity · revenue · competitive pricing · market power
Unit of increase
- long runExtended period ahead
- break-evenNo net gain
- diminishing returnsReduced benefit from additional effort
- economies of scaleCost advantages from size
What something generates
- quantityMeasurable amount present
- inputsData fed in
- raw materialsUnprocessed production inputs
- manufacturingIndustrial product creation
overhead · capacity · throughput · scalability · expansion · efficiency
Maximizing efficiency or performance
- trade-offExchange requiring sacrifice
- thresholdPoint of beginning
- feasibilityPotential for success
- resource allocationAssigning available means strategically
price discrimination
Charging varied amounts per buyer
- profit maximizationPursuing greatest possible gains
- markupAdded percentage for profit
- price settingDetermining sale amounts
demand curve · supply curve · elasticity · revenue · competitive pricing · market power
increment
Unit of increase
- long runExtended period ahead
- break-evenNo net gain
- diminishing returnsReduced benefit from additional effort
output
What something generates
- quantityMeasurable amount present
- inputsData fed in
- raw materialsUnprocessed production inputs
manufacturing · overhead · capacity · throughput · scalability · expansion · efficiency
optimization
Maximizing efficiency or performance
- trade-offExchange requiring sacrifice
- thresholdPoint of beginning
- feasibilityPotential for success
- economicssupply and demand, inflation, GDP, GNP, gross domestic product
- microeconomicsdemand, supply, supply and demand, price, market
- costsoverhead
- economic chartsdemand curve, supply curve, budget line, yield curve, growth chart
- scalingscalability, power laws, horizontal scaling, self-similarity, proportionality
- cost accountingoverhead, direct labor, break-even point, budget variance
cost, costs, margin, costly, marginal, margins, marginalize, costing, marginally