Angel Rodriguez pulls up in his 24-foot panel truck in front of Sezz Medi Brick Oven Pizza in Upper Manhattan. Even though it's the middle of the summer, he's delivering- firewood. He says even though fuel costs have doubled in the past year, it's still worth the premium he gets delivering ash and cherry to the captive and growing market in NYC. How would an increase in Angel's salary affect short run costs?
A) Short run variable costs would increase.
B) Short run fixed costs would decrease.
C) Short run total costs would decrease.
D) Short run average fixed costs would increase.

Question

Quizplus · Accepted Answer

An increase in Angel's salary would increase short run variable costs because his salary is a variable cost.

Angel Rodriguez Pulls Up in His 24-Foot Panel Truck in Front