Fixed cost is:A) the cost of producing one more unit of capital,for example,machinery.B) any cost that does not change when the firm changes its output.C) average cost multiplied by the firm's output.D) usually zero in the short run.

Question

Fixed cost is:A)  the cost of producing one more unit of capital,for example,machinery.B)  any cost that does not change when the firm changes its output.C)  average cost multiplied by the firm's output.D)  usually zero in the short run.

Cheyenne Dreibelbis · Accepted Answer

Final Answer : B, Explanation :  Fixed cost is a cost that stays the same regardless of how much output a firm produces. Examples of fixed costs include rent, salaries, and insurance premiums. Fixed costs are important because they must be paid whether or not the firm is producing anything, and they can influence a firm's decision to continue operating in the short run. The other choices are not correct; A describes the cost of producing capital goods, not fixed costs; C describes total cost, not fixed costs; and D is not necessarily true, fixed costs may or may not be zero in the short run.

Fixed cost is:

A) the cost of producing one more unit of capital,for example,machinery.
B) any cost that does not change when the firm changes its output.
C) average cost multiplied by the firm's output.
D) usually zero in the short run.

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