Asked by Mylene Salazar on Jul 17, 2024
Verified
Electricity generating plants with low fixed costs tend to have high operating costs.
Electricity Generating Plants
Facilities that convert various forms of energy into electrical power, such as coal, natural gas, nuclear, solar, or wind energy.
Fixed Costs
Costs that do not change with the level of output produced, such as rent or salaries.
Operating Costs
Costs associated with the day-to-day running of a business, including rent, utilities, payroll, and raw materials, but excluding capital expenditures and debt service.
- Understand the economic advantages of utilizing different energy sources for electricity production.
Verified Answer
TA
Tatin AmoyoJul 24, 2024
Final Answer :
True
Explanation :
Plants with low fixed costs, such as natural gas plants, often have higher operating costs because they rely on the purchase of fuel, which can fluctuate in price and contribute significantly to the cost of operation.
Learning Objectives
- Understand the economic advantages of utilizing different energy sources for electricity production.