Assume That a Firm's Costs Are Split Between Variable Costs

question 116

Multiple Choice

Assume that a firm's costs are split between variable costs and fixed costs.Once variable costs are covered

• A) any extra money is profit.
• B) any extra money goes toward paying the fixed costs.
• C) the firm will shut down.
• D) the firm will make an economic profit.
• E) the firm will break even.

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Definitions:

Express

Refers to a service or method that is designed to be faster or more efficient than standard options.

CPI

The Consumer Price Index, a measure that examines the weighted average of prices of a basket of consumer goods and services, used as an indicator of inflation.

Salary

Regular payment made by an employer to an employee, especially a professional or white-collar worker.

Exchange Rate

The value of one currency for the purpose of conversion to another, determining how much of one currency can be exchanged for another.