Which of the following costs changes in direct proportion to a change in the activity level?
A) Variable cost.
B) Fixed cost.
C) Semivariable cost.
D) Step-variable cost.
E) Step-fixed cost.

Question

Quizplus · Accepted Answer

Variable costs change in direct proportion to a change in the activity level, meaning they increase as activity increases and decrease as activity decreases. Fixed costs remain constant regardless of activity levels, while semivariable, step-variable, and step-fixed costs have characteristics that do not strictly follow direct proportionality to activity changes.

Which of the Following Costs Changes in Direct Proportion to a Change