-The production and cost information provided in the table above for Flaming Fernando's,a restaurant that sells Fiery Frijoles,is for the
A) short run because there are no variable costs.
B) short run because there is a fixed cost.
C) long run because there are no variable costs.
D) long run because there are no fixed costs.
E) short run and long run because the total cost increases as production increases.

Question

-The production and cost information provided in the table above for Flaming Fernando's,a restaurant that sells Fiery Frijoles,is for the
A) short run because there are no variable costs. 
B) short run because there is a fixed cost. 
C) long run because there are no variable costs. 
D) long run because there are no fixed costs. 
E) short run and long run because the total cost increases as production increases.

Quizplus · Accepted Answer

In the short run, at least one factor of production is fixed, which often results in a fixed cost. The presence of a fixed cost in the scenario indicates that it is the short run, as costs are not entirely variable.

-The Production and Cost Information Provided in the Table Above