Question

iane is remodeling an apartment that she will rent out to a college student. The renovation is ost $7,230.If Diane decides to install decorative crown molding in the apartment, the estimated to cost $7,880. Assuming Diane chooses to install the crown molding, what is the marginal f this choice? estim at O $650 O $7,230 o $15,110 o $7,880 Hint -. O Previous @ Give Up & View Solution O Check Answer。Next ซิ

Answer 1

Answer- $650

Reason- Marginal cost is the cost of production one additional unit in a series of production.

In present case renovation of appartment without crown molding is $7230. Whereas just by choosing to install crown molding the expense becomes $7880. So the cost of this choice is 7880 - 7230 = 650, which is the marginal cost of this choice.