A Company Has Fixed Costs of $75,000 Per Month

question 256

Multiple Choice

A company has fixed costs of $75,000 per month. If sales double from 5,000 to 10,000 units during the month, fixed costs will

• A) remain the same.
• B) double.
• C) be cut in half.
• D) increase slightly.

---

Definitions:

Price Volatile

Characterizes a market or commodity whose price is subject to rapid, unexpected, and often large changes.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded for a given period.

Supply Curve

A graph showing the relationship between the quantity of goods supplied by producers and the price of those goods.

Price Levels

The average of current prices across the entire spectrum of goods and services produced in the economy.