For a restaurant:
A) labor and food would be variable factors of production.
B) a building would be a fixed factor of production in the short run.
C) fire insurance on a building would be a fixed factor of production.
D) A and B are correct.

Question

Quizplus · Accepted Answer

Labor and food are variable factors of production in a restaurant as they can be easily adjusted to meet the changing demands of the business. On the other hand, the building is a fixed factor of production in the short run, meaning that it cannot be easily adjusted or changed. Fire insurance on a building is not a factor of production, but rather a form of risk management or protection for the fixed factor of production, which is the building. Therefore, options A and B are correct, while C is not directly related to production factors in a restaurant.

For a Restaurant