In the analysis of economic cost and revenue curves, which of the following BEST describes variable costs?
A) They remain stable at any production level within a certain range.
B) They can be calculated by dividing the total of fixed costs by the number of units produced.
C) They change with the level of production.
D) They represent the change in total cost that results from producing one more unit of production.

Question

Quizplus · Accepted Answer

Variable costs refer to costs that change with the level of production. As production increases, so do variable costs, and as production decreases, variable costs decrease as well. This is different from fixed costs, which remain stable at any production level within a certain range. Option A is incorrect. Option B refers to average fixed costs, not variable costs. Option D describes marginal cost.

In the Analysis of Economic Cost and Revenue Curves, Which