Adam spent $10,000 on new equipment for his small business, "Adam's Fitness Studio." Membership at his fitness center is very low and at this rate, Adam needs an additional $12,000 per year to keep his studio open. Which of the following is true
A) The fixed cost of running the studio is $22,000.
B) The $10,000 Adam spent on equipment is the total cost of starting the business and the $12,000 he'll need to continue operations is a marginal cost.
C) The variable cost of running the studio is $22,000.
D) The $10,000 Adam spent on equipment is a fixed cost of business and the $12,000 he'll need to continue operations is a variable cost.
D
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In the second circular-flow model of Chapter 2, households have two uses for their total income:
A) consumption and investment. B) consumption and saving. C) saving and investment. D) saving and payment of taxes. E) consumption and payment of taxes.
Which of the following will cause a rightward shift of the demand curve?
A) a decrease in the cost of production B) a decrease in the price of the good C) an increase in the expected future price of the good D) all of the above