marginal cost

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marginal cost

[′mär·jən·əl ′kȯst]
(industrial engineering)
The extra cost incurred for an extra unit of output.
References in periodicals archive ?
There are, however, few resources available to educators or practicing managers that highlight the decision errors that can result from not recognizing the effects of the non-constant marginal cost of capital. It is in this spirit that anecdotal scenarios, or cases, can be of help to both educators and practicing managers in understanding the proper application of capital budgeting methods.
Consequently, expected return (the average cost of capital), [omega](Y), exceeds the growth boundary (the marginal cost of capital), [omega](Y) [greater than or equal to] [[xi].sup.*].
The marginal cost of capital, k, should reflect only the market-related--that is, systematic--risk of the project (rather than the firm).
Basic economic theory predicts that firms invest in capital up to the point where the expected marginal efficiency of investment (MEI) is equal to the marginal cost of capital (MCC).