Producers must understand the marginal benefit of making an additional unit, which shows the actual gain. eventual gain. possible gain. unlikely gain.

Possible gain

Explanation:

Marginal benefit is related to the increment in consumer consumption of an additional product. And possible gain or marginal cost is about the increment of input in company expense that will be used in making an additional unit.

To produce additional unit producer must keep in mind about possible gains. like, why are we going to produce an extra unit? what does it cost in making an extra unit? what will be the benefit of an extra unit?

When it is necessary, individually and social marginal cost should be drawn separately to understand the difference of facts which will be faced after doing so. The marginal cost of society can be increased with pollution than invidiously cost because of external forces or penalties.

Normally marginal benefits decrease when a consumer decides to be on one good for a long time. Suppose there is a woman, having a piece of jewelry and she goes to the market to buy a ring for the right hand. She gets a ring of $100 and at the same time she finds another ring which she had not to buy but it attracted her and she is willing to spend $100 more on it. However, she has convinced to buy it in $50. So here the marginal benefit of her has decreased to $50.

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