Figure 4.2 Short-Run Cost Curves

-Refer to Figure 4.2. Even if this firm produces zero units of output, it will still
A) have no fixed costs
B) make a profit
C) be producing other products
D) have fixed costs

Question

Figure 4.2 Short-Run Cost Curves
 
-Refer to Figure 4.2. Even if this firm produces zero units of output, it will still
A) have no fixed costs 
B) make a profit 
C) be producing other products 
D) have fixed costs

Quizplus · Accepted Answer

Fixed costs are expenses that do not change with the level of output, such as rent, salaries, and insurance. Therefore, even if a firm produces zero units, it will still incur these costs.