When a firm produces one unit, the variable cost is $3. When the firm produces two units, the variable cost is $6. What is the marginal cost associated with two units of production? A) $0.5 B) $2 C) $6 D) $3

Option (D) is correct.

Explanation:

Given that,

Variable cost of one unit = $3

Variable cost of two units = $6

Marginal cost refers to the cost of producing an additional unit of an output and it is added to the total cost of production.

Therefore,

Marginal cost:

= Variable cost of two units - Variable cost of one unit

= $6 - $3

= $3

Hence, the marginal cost associated with two units of production is $3.