Total Fixed Cost (TFC)

question 264

Multiple Choice

Total fixed cost (TFC)

• A)falls as the firm expands output from zero, but eventually rises.
• B)falls continuously as total output expands.
• C)varies directly with total output.
• D)does not change as total output increases or decreases.

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Definitions:

Marginal Change

A small adjustment to an existing set of conditions or a system, measuring the effect of a one-unit increase or decrease in some variable.

Centrally-Planned Economy

An economic system where all major decisions regarding production, distribution, and consumption are made by the government.

Economic Activity

The total amount of production, distribution, and consumption of goods and services in an economy.

Marginal Cost

The bump in complete expenses that occurs when an additional unit of a product or service is produced.