Can you tell me Is it True or False ?

A firm with substantial fixed costs such as a manufacturing overhead will have a lower degree of risk in the trough of a business cycle than will a firm with high variable costs and limited fixed costs.True/False?Can you tell me Is it True or False ?
Higher fixed costs mean higher risk.





Limited fixed costs mean lower risk.





Remember, a business will remain in operation for the short term if the revenues equal the variable costs. That is, a business will continue to operate (for a while) even if the only loss it suffers is the overhead.





It will shut down entirely when variable costs exceed revenue.