A firm incurred the following costs in production. Use the information in the table to answer questions below
|
Output(bags of rice) |
0 | 10 | 20 | 30 | 40 | 50 |
60 |
|
Total cost$ |
100 | 200 | 300 | 380 | 440 | 520 |
600 |
The fixed cost of production is
Fixed cost is the cost that does not change with the level of output. It is the cost incurred even when the output is zero. From the
table, when the output is zero, the total cost is $100. Therefore, the fixed cost of production is $100.
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