The correct answer is C. Semi-variable costs are partly fixed and partly variable in relation to output.
Fixed costs are costs that do not change with the level of output. Examples of fixed costs include rent, insurance, and depreciation. Variable costs are costs that change with the level of output. Examples of variable costs include raw materials, labor, and energy. Semi-variable costs are costs that have both fixed and variable components. Examples of semi-variable costs include maintenance costs and sales commissions.
Maintenance costs are typically fixed for a certain level of output, but they may increase if there is a lot of wear and tear on equipment. Sales commissions are typically a percentage of sales, so they increase as sales increase.
Semi-variable costs can be difficult to budget for because it is not always clear how much of the cost is fixed and how much is variable. However, it is important to try to estimate semi-variable costs as accurately as possible in order to create accurate budgets and forecasts.