For example, if the total cost of producing three units of output is $2,498 and the total cost of producing four units of output is $3,087, then the marginal cost of the fourth unit is

The marginal cost of fourth unit is $589

Explanation:The marginal cost of a good is defined as the cost of producing an additional one unit which increases the total cost of such good. Therefore we can say that;

Marginal cost=Total cost at 4 units - total cost at (4-1) units

 =total cost of  the  4 units - total cost of the  three units

              =3,087 -2,498

             =$589

Also using the formulae;

Marginal cost = Change in cost / change in quantity

= 3,087 -2,498/4-3 =589/1= $589

The marginal cost of fourth unit is $589

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