# ⓘ Marginal concepts ..

## Gossen's laws

Gossens laws, named for Hermann Heinrich Gossen, are three laws of economics: Gossens First Law is the "law" of diminishing marginal utility: that marginal utilities are diminishing across the ranges relevant to decision-making. Gossens Second Law, which presumes that utility is at least weakly quantified, is that in equilibrium an agent will allocate expenditures so that the ratio of marginal utility to price marginal cost of acquisition is equal across all goods and services. ∂ U / ∂ x i p i = ∂ U / ∂ x j p j ∀ i, j {\displaystyle {\frac {\partial U/\partial x_{i}}{p_{i}}}={\frac {\parti ...

## Gossen's second law

Gossens Second" Law”, named for Hermann Heinrich Gossen, is the assertion that an economic agent will allocate his or her expenditures such that the ratio of the marginal utility of each good or service to its price is equal to that for every other good or service. Formally, ∂ U / ∂ x i p i = ∂ U / ∂ x j p j ∀ i, j {\displaystyle {\frac {\partial U/\partial x_{i}}{p_{i}}}={\frac {\partial U/\partial x_{j}}{p_{j}}}~\forall \lefti,j\right} where p i {\displaystyle p_{i}} is the price of the i {\displaystyle i} -th good or service U {\displaystyle U} is utility x i {\displaystyle x_{i}} is qu ...

## Marginal abatement cost

Abatement cost is the cost of reducing environmental negatives such as pollution. Marginal cost is an economic concept that measures the cost of an additional unit. The marginal abatement cost, in general, measures the cost of reducing one more unit of pollution. Although marginal abatement costs can be negative, such as when the low carbon option is cheaper than the business-as-usual option, marginal abatement costs often rise steeply as more pollution is reduced. Marginal abatement costs are typically used on a marginal abatement cost curve, which shows the marginal cost of additional re ...

## Marginal concepts

In economics, marginal concepts are associated with a specific change in the quantity used of a good or service, as opposed to some notion of the over-all significance of that class of good or service, or of some total quantity thereof.

## Marginal cost

In economics, marginal cost is the change in the total cost that arises when the quantity produced is incremented by one unit; that is, it is the cost of producing one more unit of a good. Intuitively, marginal cost at each level of production includes the cost of any additional inputs required to produce the next unit. At each level of production and time period being considered, marginal costs include all costs that vary with the level of production, whereas other costs that do not vary with production are fixed and thus have no marginal cost. For example, the marginal cost of producing ...