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Chapter 22: Q. b- For Critical Thinking (page 492)

Are the annual expenses that a shipper must incur to maintain its iBubble Wrap air pumps part of its fixed costs or of its variable costs?

Short Answer

Expert verified

Fixed costs tend to be costs that are based on time rather than the quantity produced or sold by your business. Examples of fixed costs are rent and lease costs, salaries, utility bills and loan repayments.

Step by step solution

01

Introduction.

To find that the shipper must incur to maintain its iBubble Wrap air pumps part of its fixed costs or of its variable costs.

02

Reason for the shipper must incur to maintain its iBubble Wrap air pumps.

Shipper must incur to maintain its iBubble Wrap air pumps part of its fixed costs and therefore, Fixed costs will be costs that don't change when deals or creation volumes increment or diminishing. This is on the grounds that they are not straightforwardly connected with assembling an item or conveying a help. Subsequently, fixed costs are viewed as roundabout expenses.

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Most popular questions from this chapter

A watch manufacturer finds that at 1000units of output, its marginal costs are below average total costs. If it produces an additional watch, will its average total costs rise, fall, or stay the same?

The diagram below displays short-run cost curves for a facility that produces liquid crystal display (LCD) screens for cell phones:

a What are the daily total fixed costs of producing LCD screens?

b. What are the total variable costs of producing 100LCD screens per day?

cWhat are the total costs of producing 100LCD screens per day?

d What is the marginal cost of producing100LCD screens instead of 99? (Hint: To answer this question, you must first determine the total costs-or, alternatively, the total variable costsof producing 99LCD screens.)

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If this firm were to boost its output to 12 units of output and thereby raise its total variable costs to $54, what would be the resulting average fixed cost, average variable cost, average total cost, and marginal cost?

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a. What are average variable costs at this firm's current output level?

b. What is the average product of labor?

c. What monthly wage does the firm pay each worker?
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