The table given below shows the average total cost of production of a firm at different levels of the output.Table 8.5

-In the short run when output is zero, total cost is:
A)equal to total variable cost.
B)greater than total fixed cost.
C)equal to total fixed cost.
D)less than total fixed cost.
E)less than total variable cost.

Question

The table given below shows the average total cost of production of a firm at different levels of the output.Table 8.5
 
-In the short run when output is zero, total cost is:
A)equal to total variable cost. 
B)greater than total fixed cost. 
C)equal to total fixed cost. 
D)less than total fixed cost. 
E)less than total variable cost.

Quizplus · Accepted Answer

In the short run when output is zero, total cost is equal to total fixed cost. This is because fixed costs are incurred regardless of the level of output and do not vary with changes in output levels. Therefore, the answer is C.

The Table Given Below Shows the Average Total Cost of Production