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A restaurant imposes a minimum charge of 150 LE. What is this type of cost to...

A restaurant imposes a minimum charge of 150 LE. What is this type of cost to the consumer? a. Fixed cost b. Semi-variable cost c. Variable cost

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Answer #1

Solution: Option A (FIXED COST) is the correct answer

A restaurant indicates charge of 150 LE is charged as minimum charge per customer it indicates it is a fixed cost

Fixed cost is defined as a cost that does not change with an increase or decrease in the amount of goods or services produced or sold.They are assumed to remain constant for a given period of time irrespective of level of output.

From the above solution we can say that OPTION A satisfies the given requirement in the question whereas remaining OPTIONS B,C, do not meet the requirement of question and hence they are incorrect.

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