The Fixed Costs Required to Achieve a Desired Level of Production

question 120

Multiple Choice

The fixed costs required to achieve a desired level of production or to provide a desired level of service,while maintaining product or service attributes,are ________.

• A) discretionary fixed costs
• B) committed fixed costs
• C) capacity costs
• D) step costs

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Definitions:

Equilibrium Price

The market price at which the quantity of a good supplied is equal to the quantity demanded, resulting in market equilibrium.

Marginal Cost

The augmentation in total cost triggered by the creation of one further unit of a product or service.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, leading to a state of market equilibrium.

Equilibrium Price

The cost at which the amount of a product that buyers want to purchase matches the amount that sellers are willing to supply, creating equilibrium in the market.