In the Short Run, a Firm Has Fixed Costs but Never

question 22

True/False

In the short run, a firm has fixed costs but never any variable costs.

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Definitions:

Period Costs

Expenses that are not directly associated with the production of goods and are expensed in the period they are incurred, such as selling and administrative expenses.

Product Costs

Expenses directly incurred in the manufacturing of a product.

Period Cost

A financial metric that includes all costs not associated with the production of goods, such as administrative and sales expenses.

Product Cost

The total costs associated with making a product, including direct labor, direct materials, and overhead expenses.