Publication: Journal of Economic Education
Volume: Volume 25, No. 3
Issue: Summer 1994
Pages: pp. 261-265
Author(s): Laura A. Boyd (Denison University) and David W. Boyd (Denison University)
Address (Principal Author):Laura A. Boyd, Department of Economics, Denison University, Granville, OH 43023 (614) 587-6316
Internet Address (Principal Author):
Title: The Short- and Long-Run Marginal Cost Curve: An Alternative Explanation
Abstract: In a recent issue of this Journal, Sexton, Graves and Lee provided a much needed and cogent graphical explanation of why short-run marginal cost is less than long-run marginal cost for quantities of output less than the level at which the two measures are equal. Their approach utilized isoquants and isocosts. This comment offers an alternative explanation that has two pedagogical advantages over the earlier methodology. First, our approach also shows why, at the level of output for which both short-run and long-run average costs are equal, short-run and long-run marginal costs must also equate. Second, the explanation relies solely on cost curves, and thus does not depend on material which is often presented in earlier chapters in textbooks.