The marginal cost of an activity can be found by calculating the change in:

• A. total cost divided by the change in quantity
• B. fixed cost divided by the change in quantity
• C. average cost divided by the change in output
• D. total revenue divided by the change in price

Answer: (A)

Verified step by step guidance

1. Understand that marginal cost (MC) measures the additional cost incurred by producing one more unit of output.
2. Recall the formula for marginal cost: \(MC = \frac{\Delta TC}{\Delta Q}\), where \(\Delta TC\) is the change in total cost and \(\Delta Q\) is the change in quantity produced.
3. Recognize that fixed costs do not change with output, so dividing fixed cost by change in quantity does not give marginal cost.
4. Note that average cost divided by output is not related to marginal cost; average cost is total cost divided by quantity, not a change measure.
5. Understand that total revenue divided by change in price relates to marginal revenue, not marginal cost.