Author Question: Explain why some costs are considered to be variable and some fixed. How does time enter into the ... (Read 67 times)

vicky · **on:** Jun 30, 2018

Explain why some costs are considered to be variable and some fixed. How does time enter into the definition?

Question 2

The supply curve in the market for land that has limited availability is:
a. perfectly elastic.
b. relatively inelastic.
c. unit elastic.
d. perfectly inelastic.
e. relatively elastic.

asware1 · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

Some factors cannot be adjusted quickly in the short run. Costs associated with these factors are called fixed costs. Variable costs are costs incurred through the utilization of factors that can be readily varied in the short term (such as raw materials or labor). Variable costs are costs that increase as output increases, and decrease as output decreases. All costs are variable in the long run when firms have sufficient time to vary all factors of production.

Answer to Question 2

d