Find the cost of producing one more unit.
Please do not make financial decisions based on these results.
What is the Marginal Cost Calculator?
Find the cost of producing one more unit. To use the Marginal Cost Calculator, enter total cost at lower output, lower output, total cost at higher output, higher output; it returns marginal cost, average cost at higher output, and shows them instantly as you type.
Where the Marginal Cost Calculator fits
Find the cost of producing one more unit. The main figure it returns is the Marginal cost, worked out from the values you enter.
It belongs with the other accounting & microeconomics tools. If you are comparing options or checking a result from another angle, try the Marginal Revenue Calculator, Average Variable Cost Calculator or the Optimal Price Calculator.
How to use the Marginal Cost Calculator
- Enter your numbers. The inputs are Total cost at lower output ($), Lower output (units), Total cost at higher output ($), Higher output (units). Use numbers from the same accounting period so the ratios are comparable. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the Marginal cost, and the cards below show Average cost at higher output. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the Marginal Cost Calculator using the default values shown in the calculator above:
Inputs
| Total cost at lower output ($) | 50,000 |
|---|---|
| Lower output (units) | 1,000 |
| Total cost at higher output ($) | 58,500 |
| Higher output (units) | 1,200 |
Results
| Marginal cost | $42.50 |
|---|---|
| Average cost at higher output | $48.75 |
With these inputs the calculator returns Marginal cost: $42.50. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Total cost at lower output ($) from 50,000 to 60,000 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| Marginal cost | $42.50 | -$7.50 | -117.6% |
| Average cost at higher output | $48.75 | $48.75 | 0% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the Marginal Cost Calculator reports Marginal cost and average cost at higher output. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
Where is profit maximized?
Where marginal cost equals marginal revenue.
What is the difference between EBIT and EBITDA?
EBITDA also adds back depreciation and amortization, so it approximates operating cash profit.
Which accounting standard do the formulas follow?
They use the common textbook definitions that apply under both US GAAP and IFRS unless a tool says otherwise.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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