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Economics · Oct / Nov 2018 · Paper 12 · Question 15

2281Firms’ costs, revenue and objectives

Which statement about total fixed cost is correct?

  1. AIt falls as output increases.
  2. BIt is calculated by adding total cost and total variable cost.
  3. CIt is calculated by dividing total cost by output.
  4. DIt must be paid even if output is zero.

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Correct answer: D. It must be paid even if output is zero.

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