Question 7 If fixed cost at \( Q=100 \) is \( \$ 130 \), then fixed cost at \( Q=0 \) is \( \$ 0 \) fixed cost at \( Q=0 \) is less than \( \$ 130 \) fixed cost at \( Q=200 \) is \( \$ 260 \) fixed cost at \( Q=200 \) is \( \$ 130 \) it is impossible to calculate fixed costs at any other quantity
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Fixed cost is independent of the quantity produced, meaning it remains constant regardless of the level of output. So, if the fixed cost at \( Q=100 \) is \$130, it will also be \$130 when \( Q=0 \) or at any other quantity like \( Q=200 \). The nature of fixed costs is that they don’t fluctuate with production levels, making it easy to predict costs. When considering businesses, understanding fixed costs is essential for budgeting and pricing strategies. A clear grasp of fixed and variable costs can help companies set prices effectively, manage profits, and make informed decisions about scaling production. So, always keep an eye on those fixed costs - they stick around whether you’re cranking out products or not!
