Answered

A farmer has developed a new type of fertilizer that costs 20% more to produce than the old fertilizer but yields 25% more crops annually.

Which statement best describes one way the farm will be affected by using this new fertilizer?

A. The farm's marginal cost for fertilizer will decrease.
B. The farm's marginal cost for fertilizer will increase.
C. The farm's opportunity cost for using fertilizer will decrease.
D. The farm's opportunity cost for using fertilizer will increase.



Answer :

GinnyAnswer

Final answer:

Using the new fertilizer will increase the farm's marginal cost for fertilizer.


Explanation:

Marginal cost for fertilizer refers to the additional cost incurred by producing one more unit of fertilizer. In this case, since the new fertilizer costs 20 percent more to produce but leads to 25 percent more crop production, the farmer's marginal cost for fertilizer will increase. The improved results from the new fertilizer come at a higher production cost.


Learn more about Fertilizer Cost and Crop Production here:

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