[amp_mcq option1=”be fixed according to the rate of growth” option2=”changes with the volume of production” option3=”does not change with volume of production” option4=”remains constant” correct=”option2″]<\/p>\n
The correct answer is: B. changes with the volume of production.<\/p>\n
Variable costs are costs that change in direct proportion to the volume of production. For example, the cost of raw materials is a variable cost, because the more products you produce, the more raw materials you will need.<\/p>\n
Fixed costs are costs that do not change in proportion to the volume of production. For example, the cost of rent is a fixed cost, because the rent you pay will be the same regardless of how many products you produce.<\/p>\n
Mixed costs are costs that have both variable and fixed components. For example, the cost of electricity is a mixed cost, because the amount of electricity you use will vary depending on the volume of production, but you will still have to pay a certain amount for the electricity that you use, even if you don’t produce anything.<\/p>\n
I hope this helps!<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”be fixed according to the rate of growth” option2=”changes with the volume of production” option3=”does not change with volume of production” option4=”remains constant” correct=”option2″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-52549","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"\n