Which of the following is a characteristic of a fixed cost?
A)The total cost remains constant,regardless of changes in the level of activity.
B)The cost per unit varies inversely with changes in the level of activity.
C)Both that the total cost remains constant,regardless of changes in the level of activity and that the cost per unit varies inversely with changes in the level of activity.
D)Neither that the total cost remains constant,regardless of changes in the level of activity nor that the cost per varies inversely with changes in the level of activity.

Question

Quizplus · Accepted Answer

A characteristic of fixed cost is that the total cost remains constant, regardless of changes in the level of activity. Additionally, the cost per unit decreases as the level of activity increases. Therefore, choice C is the correct answer as it correctly identifies both characteristics of fixed cost.

Which of the Following Is a Characteristic of a Fixed