Fixed and Variable Costs

(a)   are all of the expenses that a business incurs (pays).

The total costs are calculated as the sum of the (a)   costs and the variable costs.

(a)   costs don't vary as the business changes its output

(a)   costs change directly with output.

Fixed or Variable?

Wages paid for factory labour?

• Fixed

• Variable

Fixed or Variable?

Raw materials

• Fixed

• Variable

Fixed or Variable?

Transport costs

• Fixed

• Variable

Fixed or Variable?

Office rent

• Fixed

• Variable

Fixed or Variable?

Insurance

• Fixed

• Variable

Fixed or Variable?

Salaries

• Fixed

• Variable