-The Production and Cost Information Provided in the Table Above

question 72

Multiple Choice

-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.

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Definitions:

Consumer Surplus

The split between the maximum total consumers are prepared to pay for a product or service and the actual payment.

Producer Surplus

The gap between the minimum amount producers are willing to accept for providing a good or service and the actual amount they end up receiving.

Producer Surplus

The additional income a producer receives for selling a good or service above its production cost.

Tax

A tax is a compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization.