[amp_mcq option1=”Fuel cost” option2=”Interest on capital” option3=”Insurance charges” option4=”Depreciation” correct=”option1″]<\/p>\n
The correct answer is: A. Fuel cost<\/strong><\/p>\n Fixed costs are costs that do not change with the level of production. They are typically incurred regardless of whether the power station is operating or not. Fuel costs, on the other hand, are variable costs that change with the level of production. The more electricity that is generated, the more fuel will be required.<\/p>\n Interest on capital is a fixed cost because it is a percentage of the amount of money that has been borrowed to finance the construction of the power station. Insurance charges are also a fixed cost because they are a percentage of the value of the power station. Depreciation is a non-cash expense that is used to account for the decline in the value of the power station over time. It is not a cash outflow and therefore does not affect the level of fixed costs.<\/p>\n In conclusion, the only option that is not a fixed cost is fuel cost.<\/p>\n","protected":false},"excerpt":{"rendered":" [amp_mcq option1=”Fuel cost” option2=”Interest on capital” option3=”Insurance charges” option4=”Depreciation” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[967],"tags":[],"class_list":["post-54327","post","type-post","status-publish","format-standard","hentry","category-economics-of-power-generation","no-featured-image-padding"],"yoast_head":"\n