A Professional Baseball Team That Has Unsold Tickets for a Friday

question 29

Multiple Choice

A professional baseball team that has unsold tickets for a Friday night game cannot resell those tickets for a game the following afternoon due to the _____ characteristic of services.

• A) Intangibility
• B) Simultaneous production and consumption
• C) Heterogeneity
• D) Perishability
• E) Divisibility

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Definitions:

Fixed Costs

Costs that do not change with the amount of goods or services produced, such as rent, salaries, or insurance.

Accounting Profit

Profits as shown on a company’s financial statements. Accounting profit does not necessarily correspond to real or economic profit.

Variable Costs

Costs that vary directly with the level of production or a company's output, such as materials and labor.

Fixed Costs

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.