Question: A cost analyst showed the general manager a graph that portrayed the firm's electricity cost as semivariable. The general manager looked at the graph and

A cost analyst showed the general manager a graph that portrayed the firm's electricity cost as semivariable. The general manager looked at the graph and said: 'This fixed-cost component doesn't look right to me. If we shut down the plant for six months, we wouldn't incur half those costs'. If you were the cost analyst, how would you respond?

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