If a firm decreases production, its:
A)variable costs decrease.
B)fixed costs decrease.
C)total costs stay the same.
D)None of these are correct.

Question

Quizplus · Accepted Answer

Variable costs vary with the level of production, so if a firm decreases production, its variable costs will decrease. Fixed costs remain constant regardless of the level of production, and total costs would change due to the change in variable costs.

If a Firm Decreases Production, Its