-Refer to Figure 8-4. Assuming the firm is profit maximising, what is the amount of its total fixed cost?

Name: -Refer to Figure 8-4. Assuming the firm is profit maximising, what is the amount of its total fixed cost?
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Quizplus · Accepted Answer

The total fixed cost is the sum of the fixed costs at each level of output. At output level 0, the fixed cost is $1080. At output level 1, the fixed cost is $1440. At output level 2, the fixed cost is $2520. Therefore, the total fixed cost is $1080 + $1440 + $2520 = $5040.