Use the following to answer question:
-(Table: Workers and Output)Use Table: Workers and Output.After graduation,you achieve your dream of opening an art shop that specializes in selling mud statues.You pay $10 per day on a loan from your uncle,regardless of how much you produce.You also pay $10 per day to each of the workers who you hire to make the mud statues.The fixed cost of producing 25 statues is:
A)$10.
B)$20.
C)$25.
D)$35.

Question

Use the following to answer question: 
-(Table: Workers and Output)Use Table: Workers and Output.After graduation,you achieve your dream of opening an art shop that specializes in selling mud statues.You pay $10 per day on a loan from your uncle,regardless of how much you produce.You also pay $10 per day to each of the workers who you hire to make the mud statues.The fixed cost of producing 25 statues is:
A)$10. 
B)$20. 
C)$25. 
D)$35.

Quizplus · Accepted Answer

Fixed costs are costs that do not change with the level of output. In this scenario, the only fixed cost mentioned is the $10 per day loan from your uncle. The cost of hiring workers is a variable cost, not a fixed cost, because it changes with the number of workers hired.

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