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To: Jeff Leader who wrote (47165)	7/15/1999 11:16:00 AM
From: Carl R.	Read Replies (1) \| Respond to of 53903

And how do you define the difference between marginal costs and variable costs? Carl

To: Jeff Leader who wrote (47165)	7/15/1999 11:57:00 AM
From: Skeeter Bug	Read Replies (1) \| Respond to of 53903

marginal costs are different than fixed costs. variable and marginal costs are, i believe, the same thing. iow, what is the extra cost required to produce one more unit (of course, fixed costs are excluded from this calculation b/c they aren't extra costs)? of course, extra material is required. if you have a temp force then extra labor can be included also. the key to this industry, as mike so eloquently pointed out, is that cost reduction only occurs with massive increases in output. the second variable is a fear of falling behind. these folks will lose money on each piece made just to stay ahead of the learning curve (cost curve). if they miss a beat then they may never catch up. it can be a deadly mixture.