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Basic Question 1 of 5
In the long run, ______
II. fixed costs are always greater than variable costs.
III. fixed costs equal variable costs.
IV. costs are increased but remain in the same proportion as in the short run.
V. costs are rising.
I. no costs are fixed.
II. fixed costs are always greater than variable costs.
III. fixed costs equal variable costs.
IV. costs are increased but remain in the same proportion as in the short run.
V. costs are rising.
User Contributed Comments 5
| User | Comment |
|---|---|
| jasonkwk | why III is wrong? |
| Bududeen | Because there are no fixed costs in the long run |
| schweitzdm | III tricked me as well. Good point @Budu. |
| fangluez | In the text, "in the long-run, all resources used by the firm are variable". |
| choas69 | thus we have economies of scale theory |
I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
evaluate a company's operating profitability and working capital using key measures
CFA® 2024 Level I Curriculum, Volume 3, Module 5.