One description of the costs of operating a railroad makes the following observation: The fixed ... expenses

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One description of the costs of operating a railroad makes the following observation: "The fixed ... expenses which attach to the operation of railroads ... are in the nature of a tax upon the business of the road; the smaller the [amount of] business, the larger the tax." Briefly explain why fixed costs are like a tax. In what sense is this tax smaller when the amount of business is larger?
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Economics

ISBN: 978-0134106243

6th edition

Authors: R. Glenn Hubbard

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