Fixed costs are costs that DO NOT change in response to changes to activity levels. Variable costs are costs that change in proportion to changes in volume or activity.It's simple, you just have to...
Well, you first have to look at fixed and variable costs in total as well as on a per unit basis. Fixed costs remain the constant (or fixed) in total. However, on a per unit basis they aren't...
It seems like it could be both. Variable because you have to do more maintenance as you increase production. Partially fixed because maintenance is necessary even if you don't product anything. If I...
Yes. Say that you own an IT company which repairs and services computers for other companies. If you changed some of your technicians' annual salaries to per-hour-of-service pay, you would change...