Let’s say you want to open a shoe store that will specialize in high-end shoes. But before you do, you want to determine how many pairs of shoes you have to sell in the first year to break even (have no profit or loss). You also want to know what your profit will be in year two. You have been busy estimating some revenues and costs. Here is what you have so far:

-How much are total fixed costs?
A)$600,250
B)$600,000
C)$250
D)$90

Question

Let’s say you want to open a shoe store that will specialize in high-end shoes. But before you do, you want to determine how many pairs of shoes you have to sell in the first year to break even (have no profit or loss) . You also want to know what your profit will be in year two. You have been busy estimating some revenues and costs. Here is what you have so far:

-How much are total fixed costs?

-How much are total fixed costs?
A)$600,250 
B)$600,000 
C)$250 
D)$90

Quizplus · Accepted Answer

Fixed costs are costs that do not change with the level of output. Therefore, the correct answer is the one that represents a cost that does not vary with production or sales levels.

Let’s Say You Want to Open a Shoe Store That