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Answered

A steel mill has fixed costs of $100 per hour and variable costs of $50 per hour. what will happen to these costs if the mill closes?

Aboth fixed and variable costs will remain the same.
Bthe mill will have no fixed costs or variable costs.
Cthe fixed costs will decrease, but the variable costs will increase.
Dthe variable costs will drop, but the fixed costs will stay the same.

Verified Answer :

meerkat18

The fixed cost of the steel mill will not be affected with the mill closing. However, the variable cost is dependent on it. The answer to the question above is letter "D. The variable costs will drop, but the fixed costs will stay the same".

Answer:

The mill will have no fixed costs or variable costs

Step-by-step explanation:

A steel mill has fixed costs of $100 per hour

A variable costs of $50 per hour.

We are supposed to find what will happen to these costs if the mill closes.

Since the mill gets closed

So, the mill will have no fixed costs or variable costs.

Hence the mill will have no fixed costs or variable costs when the mill closes

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