-If the firm described in Table 5.2 decided to produce nothing, which of the following would be true?
A) Total cost would be zero.
B) Total variable cost would be $30.
C) Total fixed cost would be $40.
D) Average total cost would be zero.
E) Marginal cost would be $10.

Question

-If the firm described in Table 5.2 decided to produce nothing, which of the following would be true?
A) Total cost would be zero. 
B) Total variable cost would be $30. 
C) Total fixed cost would be $40. 
D) Average total cost would be zero. 
E) Marginal cost would be $10.

Quizplus · Accepted Answer

If a firm decides to produce nothing, its total variable cost would be zero because variable costs depend on the level of output. However, total fixed costs remain constant regardless of the level of production. Therefore, if the firm's total fixed cost is given as $40, it would still incur this cost even if it produces nothing.

-If the Firm Described in Table 5