{"id":55697,"date":"2024-04-16T00:31:49","date_gmt":"2024-04-16T00:31:49","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=55697"},"modified":"2024-04-16T00:31:49","modified_gmt":"2024-04-16T00:31:49","slug":"if-the-fixed-cost-of-production-is-zero-which-one-of-the-following-is-correct","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/if-the-fixed-cost-of-production-is-zero-which-one-of-the-following-is-correct\/","title":{"rendered":"If the fixed cost of production is zero, which one of the following is correct?"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;OL is zero&#8221; option2=&#8221;FL is zero&#8221; option3=&#8221;CL is zero&#8221; option4=&#8221;None of the above&#8221; correct=&#8221;option4&#8243;]<!--more--><\/p>\n<p>The correct answer is: <strong>D. None of the above<\/strong><\/p>\n<p>The fixed cost of production is the cost that does not change with the level of production. It includes costs such as rent, insurance, and depreciation. The variable cost of production is the cost that changes with the level of production. It includes costs such as raw materials and labor.<\/p>\n<p>The average total cost (ATC) is the total cost divided by the number of units produced. It is equal to the sum of the average fixed cost (AFC) and the average variable cost (AVC). The average fixed cost is the fixed cost divided by the number of units produced. It decreases as the number of units produced increases. The average variable cost is the variable cost divided by the number of units produced. It increases as the number of units produced increases.<\/p>\n<p>The marginal cost (MC) is the change in total cost divided by the change in the number of units produced. It is the cost of producing one more unit. The marginal cost is always positive.<\/p>\n<p>If the fixed cost of production is zero, then the average fixed cost is also zero. However, the average variable cost and the marginal cost are still positive. Therefore, the correct answer is: <strong>D. None of the above<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;OL is zero&#8221; option2=&#8221;FL is zero&#8221; option3=&#8221;CL is zero&#8221; option4=&#8221;None of the above&#8221; correct=&#8221;option4&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-55697","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>If the fixed cost of production is zero, which one of the following is correct?<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/if-the-fixed-cost-of-production-is-zero-which-one-of-the-following-is-correct\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"If the fixed cost of production is zero, which one of the following is correct?\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;OL is zero&#8221; 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