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Total cost is ₹ 1,570 at 9 units of output and ₹ 1,670 at 10 units. Using MC = TCₙ − TCₙ₋₁, the marginal cost of the 10th unit is:
A₹ 167
B₹ 1,670
C₹ 90
D₹ 100
Answer & Solution
Correct answer: D. ₹ 100
1. MC of the nth unit = TCₙ − TCₙ₋₁.
2. TC₁₀ = ₹ 1,670 and TC₉ = ₹ 1,570.
3. MC = 1670 − 1570 = ₹ 100.
4. ₹ 167 (A) is ATC at 10 units, ₹ 90 (C) is the MC of the 9th unit, and ₹ 1,670 (B) is total cost, not the increment. Hence ₹ 100.
_Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 3 Unit II "Theory of Cost", p.6–7_
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