Cindy's Nails operates in the perfectly competitive pedicure industry.The city is considering requiring nail salons to be certified by a health inspector.The certification will cost $1,000 annually and is thus a fixed cost.The certification will affect Cindy's decision to operate, not the number of pedicures she chooses to perform if she operates.

Question

Quizplus · Accepted Answer

Since the certification cost is a fixed cost and does not change with the number of pedicures performed, it will affect Cindy's decision to operate or not, but not her decision on how many pedicures she chooses to perform if she does operate.

Cindy's Nails Operates in the Perfectly Competitive Pedicure Industry