A lighthouse that serves a dangerous coastal area is built. The lighthouse cost $500,000 to build and serves 500 ships a month. If the shipping in the area increases so that 750 ships pass by a month, the increase in additional costs of providing the light to these new ships is
A) $500,000.
B) $250,000.
C) $250.
D) $0.

Question

Quizplus · Accepted Answer

The cost of building the lighthouse is a fixed cost and does not change with the number of ships passing by. Therefore, the additional cost of providing the light to more ships is $0.

A Lighthouse That Serves a Dangerous Coastal Area Is Built