Marginal analysis is an important decision-making tool in the business world. Marginal analysis allows business owners to measure the additional benefits of one production activity versus its costs.

Sean Ross is a strategic adviser at 1031x.com, Investopedia contributor, and the founder and manager of Free Lances Ltd. Charlene Rhinehart is a CPA , CFE, chair of an Illinois CPA Society committee, ...

Marginal cost measures the cost of producing one more unit of a good. Zero marginal cost occurs when extra units can be produced at no additional cost. Marginal costs include variable costs and can ...