A ______ cost is ______ if the firm doesn't incur the cost if it produces no output.

Question

Quizplus · Accepted Answer

A fixed cost is a cost that does not vary with changes in the level of output or sales. A sunk cost is a cost that has already been incurred and cannot be recovered, regardless of future actions. Explicit costs are actual cash payments made for inputs. Variable costs are costs that vary with the level of output or sales. Therefore, the best choice is D, fixed cost and avoidable, as it accurately describes a cost that can be avoided if the firm does not produce any output.

A ______ Cost Is ______ If the Firm Doesn't Incur

A Cost Is If the Firm Doesn't Incur