Questions: Which of these examples represents a fixed input? Raw materials for construction Office supplies Hourly employees Rented office space
Transcript text: Which of these examples represents a fixed input? Raw materials for construction Office supplies Hourly employees Rented office space
Solution
Answer
The answer is rented office space.
Explanation
Option 1: Raw materials for construction
Raw materials are typically considered variable inputs because the amount needed can change based on the level of production or construction activity.
Option 2: Office supplies
Office supplies are also variable inputs as their usage can fluctuate depending on the business's operational needs.
Option 3: Hourly employees
Hourly employees are considered variable inputs because their labor hours can be adjusted according to the workload or production requirements.
Option 4: Rented office space
Rented office space is a fixed input because it generally involves a fixed cost that does not change with the level of production or business activity, at least in the short term. The rent is usually a set amount agreed upon in a lease contract, making it a fixed cost.