Explanation:
In the short run, there must be at least one fixed factor of production.
Fixed factor of production: refers to the idea of when the quantity of a factor of production can't be changed over a fixed time period.
Total fixed cost stays the same whether the production increases or decreases.
Example:
The fixed factor of production in case of a dentist are; office rent and some of the dental equipment.
Capital cost is usually the most common fixed factor of production in the short run. Other common fixed factors of production include; rent, insurance, utility bills, and certain salaries
a. Golf course
Capital cost of land, golf carts, golf equipment costs are most likely to be fixed factors of production.
b. Movie theater
Rental, Insurance, and utility bills costs are most likely to be fixed factors of production, whereas ticket sales, popcorn and soft drinks sales depend upon the number of customers hence they are variable factors of production.
c. Law office
Office rent, utility bills, certain staff salary costs are most likely to be fixed factors of production.
d. Brewery
Capital cost of land, brewing equipment costs are most likely to be fixed factors of production.
e. Amusement park
Capital cost of land, rides, infrastructure etc costs are most likely to be fixed factors of production.
