An increase in the marginal cost of production causes

Assessment: JAMB UTME - Economics - 2007 Subject: Economics

Question 1 Report

An increase in the marginal cost of production causes
Answer Details
An increase in the marginal cost of production causes an upward movement along the supply curve. Marginal cost is the additional cost incurred in producing an additional unit of a good or service. When marginal cost increases, it becomes more expensive for producers to produce each additional unit. As a result, producers will supply fewer units at any given price, and the supply curve shifts upward. This means that the quantity supplied at any given price will decrease, resulting in a decrease in the overall supply.
Read lesson note on The Theory Of Supply (JAMB)
Read lesson note on The Theory Of Production (JAMB)
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