The total cost to the firm of producing zero units of output is
A)zero in both the short run and the long run.
B)its fixed cost in the short run and zero in the long run.
C)its fixed cost in both the short run and the long run.
D)its variable cost in both the short run and the long run.

Question

Quizplus · Accepted Answer

In the short run, a firm incurs fixed costs even when producing zero output. In the long run, all costs are variable, so the cost of producing zero units is zero.

The Total Cost to the Firm of Producing Zero Units