The Ujsag Printing Co. wants to calculate the cost of adding a third machine. Comment on the following statement made by the company accountant: “If we add a third printing press, our total costs will increase from $1060 to $1191. Therefore the marginal cost of the third machine is $1191/3=$397.” Is the accountant correct? Explain your reasoning.

Answer rating: 100% (QA)

No the accountant is not entirely correct While the calculation might seem straightforward it overlo... View the full answer