In the Short Run Time Horizon for a Firm,total Fixed

question 93

Multiple Choice

In the short run time horizon for a firm,total fixed costs

• A)decrease and then increase as output increases.
• B)decrease as output increases.
• C)do not vary with output.
• D)increase and then decrease as output increases.
• E)are equal to total variable costs.

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Definitions:

Contribution Margin

This measure reflects the amount of revenue per unit that exceeds the variable costs of the unit, contributing to covering fixed costs and generating profit.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, ending with net profit or loss.

Fixed Cost

Regular, unwavering expenses in business operations that do not fluctuate with changes in production level or sales volume.

Cost Formula

An equation used to calculate the total cost of production or service delivery, considering both fixed and variable components.