The marginal cost is the cost of producing one additional unit of a product. It is an important metric for businesses as it helps determine the profitability of increasing production and guides pricing decisions.

## How to Use the Marginal Cost Calculator

To calculate the marginal cost:

- Enter the total cost incurred before increasing production.
- Input the total cost incurred after increasing production.
- Provide the number of additional units produced.

### Marginal Cost Formula

The formula to calculate marginal cost is:

**Marginal Cost = (Total Cost After - Total Cost Before) / Additional Units Produced**

### Why Marginal Cost Matters

Understanding marginal costs helps businesses make informed decisions about production levels and pricing strategies. If the marginal cost is lower than the selling price, increasing production can lead to higher profitability.