Figure 7-5 Figure 7-5 shows cost and demand curves facing a typical firm in a constant-cost, perfectly competitive industry.
-Refer to Figure 7-5.What is the amount of the firm's fixed cost of production?
A) $5400
B) $6750
C) $8100
D) It cannot be determined.

Question

Figure 7-5  Figure 7-5 shows cost and demand curves facing a typical firm in a constant-cost, perfectly competitive industry.
-Refer to Figure 7-5.What is the amount of the firm's fixed cost of production?
A) $5400 
B) $6750 
C) $8100 
D) It cannot be determined.

Quizplus · Accepted Answer

Fixed cost is the cost that does not change with the level of output. In this case, the fixed cost is $5400.

Figure 7-5 Figure 7-5 Shows Cost and Demand Curves