When the firm produces zero output, its variable cost is
A) zero
B) the same as total cost
C) the same as fixed costs
D) the same as price
E) infinite

Name: When the firm produces zero output, its variable cost is A) zero B) the same as total cost C) the same as fixed costs D) the same as price E) infinite
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Question

Quizplus · Accepted Answer

Variable costs are costs that change with the level of output. When output is zero, variable costs are zero because there are no production activities incurring variable expenses.

When the Firm Produces Zero Output, Its Variable Cost Is