Figure 8.5 Figure 8.5 shows cost and demand curves facing a typical firm in a constant-cost, perfectly competitive industry.
-Refer to Figure 8.5.The amount of the firm's fixed cost of production is
A)$5400
B)$6750
C)$8100
D)It cannot be determined.

Question

Figure 8.5  Figure 8.5 shows cost and demand curves facing a typical firm in a constant-cost, perfectly competitive industry.
-Refer to Figure 8.5.The amount of the firm's fixed cost of production is
A)$5400 
B)$6750 
C)$8100 
D)It cannot be determined.

Quizplus · Accepted Answer

Fixed cost is the cost that does not change with the level of output. In Figure 8.5, the fixed cost is the vertical intercept of the total cost curve, which is $5400.

Figure 85 Figure 8