If production increases by 25%, how will total fixed costs likely react?
A)Increase by 12.5%
B)Increase by 25%
C)Decrease by 25%
D)Remain the same

Question

Quizplus · Accepted Answer

Total fixed costs are not affected by changes in production levels. Fixed costs remain constant regardless of the amount of output being produced. Therefore, if production increases by 25%, total fixed costs will remain the same.

If Production Increases by 25%, How Will Total Fixed Costs