Scenario 9.1: 21st Century Pen, Inc. produces 2,000 pens per day, and hires 20 workers at a cost of $200 per day per worker. The price of each pen is $5 each. 21st Century Pen, Inc. pays a daily rental rate of $60 on its factory and a daily insurance rate of $20. 21st Century Pen, Inc. has a ten year lease on the factory, an insurance contract for a year, and the company has no other expenses.
-Refer to Scenario 9.1.21st Century Pen,Inc.'s fixed cost is

Question

Quizplus · Accepted Answer

Fixed costs are those that do not change with the level of production or sales, and in this scenario, the fixed costs are the daily rental rate of the factory ($60) and the daily insurance rate ($20), which add up to $80 per day.