Question: Consider a marginal cost function MC = 5 + Q, where MC indicates the marginal cost in the unit of dollars and Q is the

  1. Consider a marginal cost function MC = 5 + Q, where MC indicates the marginal cost in the unit of dollars and Q is the quantity of output. Which of the following statements interprets the marginal cost function correctly?

  1. Producing one more unit of output costs $5.
  2. Producing the Q-th unit of output costs $(5 + Q) more than producing the (Q - 1)th unit of output.
  3. Producing the Q units of output costs $(5 + Q).
  4. Producing one unit of output costs $(5 + Q) on average.

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