How are fixed costs different from variable costs?

Fixed costs are costs associated with capital, such as machinery; variable costs are the cost of labor.

Fixed costs do not change no matter how much a business produces; variable costs do change.

Fixed costs only exist in command economies; variable costs only exist in market economies.

Fixed costs are the same for all businesses; variable costs apply to individual businesses alone.

Question

Micheal Monroe

Business

21 January, 01:58

How are fixed costs different from variable costs?

Fixed costs are costs associated with capital, such as machinery; variable costs are the cost of labor.

Fixed costs do not change no matter how much a business produces; variable costs do change.

Fixed costs only exist in command economies; variable costs only exist in market economies.

Fixed costs are the same for all businesses; variable costs apply to individual businesses alone.

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Answers (2)

Know the Answer?

Ryann Blake · Answer 1

How are fixed costs different from variable costs?

Fixed costs are costs associated with capital, such as machinery; variable costs are the cost of labor.

Van Mcconnell · Answer 2

How are fixed costs different from variable costs? Fixed costs do not change no matter how much a business produces; variable costs do change.

Explanation:

when a company decides to produce a certain commodity fixed cost and variable costs are the main costs of the company. Fixed costs are constant regardless of the amount of output a company produces. e. g insurance and rental payment while Variable cost changes or varies or with the amount of goods and services produced by a company. e. g money paid for labour.