A fruit packing plant usually shuts down for three months each year. During that period, its

Question

Quizplus · Accepted Answer

The shutdown period does not mean that the plant incurs no costs at all. Fixed costs, such as rent on the building and equipment, property taxes, insurance, etc., are likely to continue even when the plant is not producing or selling any fruit. Therefore, the correct answer is that the fixed costs are greater than zero.

A Fruit Packing Plant Usually Shuts Down for Three Months