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:

Consumer's Surplus

The difference between the total amount that consumers are willing to pay for a good or service and the total amount that they actually pay.

Mead

An alcoholic beverage created by fermenting honey with water, sometimes with various fruits, spices, grains, or hops added.

Demand Function

A mathematical representation that describes the relationship between the quantity demanded of a good and various factors that influence this quantity, such as price.

Consumer's Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually pay.