Figure 7.4 Figure 7.4 shows the cost and demand curves for a profit-maximising firm in a perfectly competitive market.
-Refer to Figure 7.4.Assuming the firm is profit maximising,the amount of its total fixed cost is -.

Question

Figure 7.4  Figure 7.4 shows the cost and demand curves for a profit-maximising firm in a perfectly competitive market.
-Refer to Figure 7.4.Assuming the firm is profit maximising,the amount of its total fixed cost is -.

Quizplus · Accepted Answer

The total fixed cost is the vertical distance between the total cost curve and the total variable cost curve at a zero output level. In this case, at zero output, the total variable cost is zero, and the total cost is equal to the total fixed cost. From the graph, we can see that the total cost is $2520 when the output level is zero. Therefore, total fixed cost is $2520.

Figure 74 Figure 7