If Melissa owns a software company that incurs no fixed costs,then
A) her total cost equals her total variable cost.
B) she will earn an economic profit.
C) her total variable cost is less than her total cost.
D) her total cost equals zero.
E) her marginal cost must equal zero.

Question

Quizplus · Accepted Answer

Since there are no fixed costs involved in Melissa's software company, her total cost can be attributed to only variable costs. Hence, her total cost equals her total variable cost. Therefore, option A is the correct answer. Option B cannot be determined as we don't have any information about her revenue. Option C and D are clearly incorrect. Option E cannot be assumed as there is no information given about the shape of the marginal cost curve.

If Melissa Owns a Software Company That Incurs No Fixed