The total expense incurred by a firm in producing and marketing its products or services; the sum of fixed cost and variable cost, is referred to as
A)overhead.
B)total cost.
C)fixed costs.
D)average cost.
E)marginal cost.

Question

Quizplus · Accepted Answer

Total cost includes both fixed costs and variable costs, which are necessary for producing and marketing a firm's products or services. Overhead refers to a specific type of fixed cost, while average cost and marginal cost are measures of unit cost. Fixed costs alone are not sufficient to encompass the total expense incurred by the firm. Therefore, the best choice is B - total cost.

The Total Expense Incurred by a Firm in Producing and Marketing