The change in total cost per unit of change in output is known as by which name

The correct option is Short Run Marginal Cost.

Let us break down the concepts to understand why this is the correct answer step-by-step:

1. Understanding Marginal Cost:
In economics, the term "marginal" refers to the impact of a one-unit change. Therefore, marginal cost ($MC$) is defined as the change in total cost ($\Delta TC$) that arises from a one-unit change in the quantity of output ($\Delta Q$).

Mathematically, this relationship is expressed as:
$$MC=\frac{\Delta TC}{\Delta Q}$$
This directly matches the definition given in the question: "the change in total cost per unit of change in output".

2. Why "Short Run"?
In the short run, some factors of production (like capital or factory size) are fixed, while others (like labor or raw materials) are variable. The Short Run Marginal Cost ($SRMC$) specifically measures how total cost changes as output is varied in the short run, which is driven entirely by changes in variable costs since fixed costs do not change.

3. Why the other options are incorrect:

• Average Cost: This is the total cost divided by the number of units produced ($\frac{TC}{Q}$), representing the cost per unit, rather than the change in cost per unit of change in output.
• Variable Cost: This refers to the total expenses that vary directly with production volume (e.g., raw materials), not the rate of change of total cost.
• Fixed Cost: This refers to expenses that do not change with the level of output (e.g., rent).