Igor owns a movie theater.His total costs are $150,000 per year,and his fixed costs are $65,000.This means that his variable costs are

Question

Quizplus · Accepted Answer

Fixed costs are those expenses that do not vary with the level of production. In this case, the fixed costs are $65,000. Variable costs, on the other hand, are expenses that change as sales go up or down. Since Igor's total costs are $150,000 per year and his fixed costs are $65,000, his variable costs must be the difference between the two, which is $85,000 (i.e. $150,000 - $65,000 = $85,000). Therefore, option C) is the correct answer.

Igor Owns a Movie Theater