A Fixed Input

question 6

Multiple Choice

A fixed input:

• A) does not vary with price
• B) does not vary with costs
• C) does not vary with the level of output
• D) remains fixed in both the SR and the LR

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Definitions:

Liabilities

Financial obligations or debts owed by a business to external parties or individuals, which must be settled over time through the transfer of economic benefits.

Equity

The ownership interest in a company of its shareholders; it represents the amount of assets that would be returned to shareholders if all the company's debts were paid off.

Debt Ratio

A financial ratio that compares the amount of a company’s total debt to its total assets, indicating the leverage level.

Assets

Resources owned by a company or individual considered valuable and can be used to produce positive economic value.