Having high fixed costs makes it hard to make a profit in a recession.

Question

Quizplus · Accepted Answer

High fixed costs mean that a business has to spend a significant amount of money on expenses that do not change, regardless of how much they sell or produce. During a recession, when sales and revenue are typically lower, these fixed costs can become a burden and make it difficult to make a profit. Therefore, having high fixed costs can indeed make it hard to make a profit in a recession.

Having High Fixed Costs Makes It Hard to Make a Profit