Exhibit 7-14 Total Cost Curve In Exhibit 7-14, what is variable cost when no output is being produced?
A)$0
B)$3
C)$10
D)$20
E)impossible to calculate variable cost unless we know the daily wage

Question

Exhibit 7-14 Total Cost Curve  In Exhibit 7-14, what is variable cost when no output is being produced?
A)$0 
B)$3 
C)$10 
D)$20 
E)impossible to calculate variable cost unless we know the daily wage

Quizplus · Accepted Answer

Variable cost is the cost that varies with the level of output produced. When no output is being produced, there are no variable costs, only fixed costs which are represented by the vertical intercept of the total cost curve.

Exhibit 7-14 Total Cost Curve in Exhibit 7-14, What