If a company has fixed costs that do not change with the level of production, how do these costs affect the determination of marginal costs and total revenue?

Fixed costs are expenses that a company has to pay regardless of how much it produces, like rent or salaries. These costs do not affect the marginal cost, which is the cost of producing one more unit of a product, because marginal cost focuses only on the variable costs that change with production levels, such as materials or labor. For example, if a company spends $1,000 on fixed costs and $5 on variable costs for each unit produced, the marginal cost remains $5 for each additional unit, even if the fixed costs stay the same. Total revenue, which is the money earned from selling products, is calculated by multiplying the price of the product by the number of units sold and is not directly influenced by fixed costs. So, while fixed costs are important for overall profitability, they do not change the marginal cost or directly impact how total revenue is calculated.