marginal benefit equals marginal cost
As long as your marginal benefit -- that is, your marginal revenue -- from producing one more item exceeds your marginal cost of producing that item, you'll continue to make a profit.arginal cost is the additional cost you incur to produce one more unit. In the example, it's what it costs to make one more cake. Typically, marginal costs start out high and decline as you increase production, as overhead gets spread out over more units and you put unused capacity to work at relatively low cost.