When managers graph a linear cost function with one cost driver,the intercept represents the ________ cost and the slope represents the ________ cost.
A) variable; fixed
B) fixed; variable
C) fixed; mixed
D) variable; mixed

Question

Quizplus · Accepted Answer

In a linear cost function with one cost driver, the intercept represents the fixed cost, and the slope represents the variable cost. Therefore, option B, which states that the intercept represents the fixed cost, and the slope represents the variable cost, is the correct answer.

When Managers Graph a Linear Cost Function with One Cost