Fixed Cost Refers to

question 222

Multiple Choice

Fixed cost refers to

• A)the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold.
• B)the total expense incurred by a firm in producing and marketing a product,which equals the sum of overhead cost and variable cost.
• C)the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold.
• D)the average amount of money received for selling one unit of a product or simply the price of that unit.
• E)the change in expenses that results from producing and marketing one additional unit of a product.

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Definitions:

Capital Stock

For a single firm, the current market value of the firm’s plant, equipment, inventories, and intangible assets.

Economic Policies

Strategies and decisions by governments concerning the monetary system, taxation, market regulations, and public spending to influence the economy.

Goods And Services

The output of an economy that is provided to consumers, including tangible products (goods) and intangible items (services).

Entrepreneurial Ability

The skill or talent that an entrepreneur possesses to organize resources effectively, take risks, innovate, and create economic value.