This is the average – average cost is total cost divided by quantity.

This is the total cost of producing 10 units.

This is the average cost of calculated 9 units per day.

Marginal cost is the change in total cost as a result of producing an extra unit. The marginal cost of producing a 10th unit equals the total cost of producing 10 units minus the total cost of producing 9 units.

To produce an extra unit the total cost changes by
£14 000 − £11 250 = £2 750.