Exhibit 7-6

-Given the information in Exhibit 7-6, what is fixed cost?
A) $0
B) $200
C) $500
D) fixed cost depends on output level
E) we cannot calculate fixed cost without knowing which inputs are fixed

Question

Exhibit 7-6
 
-Given the information in Exhibit 7-6, what is fixed cost?
A) $0 
B) $200 
C) $500 
D) fixed cost depends on output level 
E) we cannot calculate fixed cost without knowing which inputs are fixed

Quizplus · Accepted Answer

Fixed cost is the same regardless of the output level, which in this case is represented by the five identical product codes. The only cost listed in the exhibit is $200, so that must be the fixed cost.

Exhibit 7-6 -Given the Information in Exhibit 7-6, What Is Fixed Cost