The fixed costs of WeBuy&Sell.com,an e-commerce website,make up about 90 percent of the total costs incurred by the company.However,since its primary means of communication is web advertising,WeBuy&Sell.com has variable costs as low as 10 percent of its total costs.This allows WeBuy&Sell.com to earn high profits at a very low cost.According to the given scenario,WeBuy&Sell.com has _____ scalability.
A) zero
B) low
C) infinite
D) high

Question

Quizplus · Accepted Answer

WeBuy&Sell.com has high scalability because its fixed costs are high and variable costs are low, allowing it to increase sales without a proportional increase in costs, leading to higher profits.

The Fixed Costs of WeBuy&Sell