CFA Practice Question

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CFA Practice Question

In the short run, the cost that is independent of the amount of output produced is called ______.

A. implicit cost
B. fixed cost
C. variable cost
Correct Answer: B

The cost of the production facility, which is independent of the amount of output produced, is called fixed cost.

User Contributed Comments 1

User Comment
MathLoser In the short run, there is time required to build or buy new plant equipment. It will stay fixed for a while.

In the long run, all inputs are variable.
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