Most ____ are relevant to decisions to acquire capacity,but not to short-run decisions involving the use of that capacity.
A)sunk costs
B)incremental costs
C)fixed costs
D)prime costs

Question

Quizplus · Accepted Answer

Fixed costs are relevant to decisions to acquire capacity because they represent the costs that do not change with the level of production or services in the short run. However, they are not relevant to short-run decisions involving the use of that capacity, as these costs remain constant regardless of the level of output.

Most ____ Are Relevant to Decisions to Acquire Capacity,but Not