This chart demonstrates that the marginal cost a) initially decreases as production increases. b) initially increases as production increases. c)eventually decreases as production increases d) eventually increases as production decreases.

The first alternative is correct (A).

The marginal cost is a microeconomic measure that aims to measure the effectiveness of the production of a given good by a company.

The marginal cost content is simple. Marginal cost is cost if you produce ONE more unit of good. For example, if I have a firm that produces chocolate and my daily output is 10 bars of chocolate per day. The marginal cost is how much it costs to produce one unit more than I normally produce, that is, the cost of the 11th bar.

The graph of pie production, initially the marginal cost is decreasing, up to the third pie. From the fourth pie, the marginal cost starts to increase steadily. This is because the company has a limited production structure, that is, three pies are produced efficiently by employees and inputs. However, as production increases, more employees must be hired, and if space is limited, each employee's productivity decreases. For example, if the company had 1 employee who produced up to 3 pies. When you hired another one, the efficiency has decreased because there is only one mixer, that is, while one employee produces the other, he has to wait.

In this way, marginal cost serves as a measure of an enterprise's efficient production rate.

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