incremental cost


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Related to incremental cost: Sunk cost

Marginal Cost

The total cost to a company to produce one more unit of a product. The marginal cost varies according to how many more or fewer units a company wishes to produce. Increasing production may increase or decrease the marginal cost, because the marginal cost includes all costs such as labor, materials, and the cost of infrastructure. For example, if a widget manufacturer increases the number of widgets it produces, it may need to buy more material, but the costs of labor and factory maintenance remain the same, and are spread out over a greater number of widgets. This may reduce the marginal cost. On the other hand, if the manufacturer hires more workers and builds another factory, it will likely increase the marginal cost. It is also known as the incremental cost.
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incremental cost

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
Examples of costs that are sometimes excluded in capacity cost incremental cost studies are sunk costs and other costs eliminated by definition.
Mortality risk differences between men and women also resulted in significantly different incremental cost estimates for the two groups.
To that end, administrators maximize hospital profits subject to the condition that the transplant department cover only incremental costs. Phrased another way, the transplant department's contribution is set to zero.
The assumption that there are incremental costs undermines the market incentives and political will to exploit the "win-win" sustainable development opportunities available.
The cost function results were used to calculate marginal costs, average incremental costs, product-specific economies of scale, and economies of scope for inpatient and outpatient care.
If buyer B's bypass cost is so low that it is less than' the incremental cost of serving B, then it is efficient to let buyer B bypass.
(b) For fiscal year 2017, which is in progress, the heads of all agencies are directed that the total incremental cost of all new regulations, including repealed regulations, to be finalized this year shall be no greater than zero, unless otherwise required by law or consistent with advice provided in writing by the Director of the Office of Management and Budget (Director).
Summary: The incremental cost projection is small compared to the untold gains the world can gain ecologically
The transactions enhance ACWA Power's financial flexibility, and the extension of the 2013 facility was also completed without incremental cost to the borrower, the statement added.
"It dilutes readily with water to form a stable bath, is compatible in typical finishing systems, and is effective at very low add-on levels, which also means very small incremental cost to the end-product design."
Whether negotiated or set by corporate rule, the transfer price is set above a seller's incremental cost. Recent survey evidence from U.S.

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