In the short run, all firms __________.

Question

do not have to pay fixed costs if there is no output produced

face substantial variable costs if no output is produced

must pay variable costs, which are costs that do not vary as output levels change

must pay a combination of fixed and variable costs if output is produced

Answer 1

In the short run, all firms must pay a combination of fixed and variable costs if output is produced.

In the short run, firms incur fixed costs regardless of their output levels, and they also incur variable costs related to the amount of output they produce. If no output is produced, firms still have to pay fixed costs but not variable costs.