Variable cost may be defined as:
A)the change in TC as more of the variable factor is employed.
B)the vertical distance between the APC and SRAC at level of output.
C)the least expenditure on all inputs to produce a level of output.
D)the least expenditure on variable inputs to produce a level of output.

Question

Quizplus · Accepted Answer

Variable cost refers to the cost incurred on the variable factors of production (such as labor, raw materials) that change with the level of output. It is the cost that varies with the level of production and is usually represented by the line connecting different points of the total variable cost curve. Therefore, the least expenditure on variable inputs to produce a level of output is the best definition of variable cost.

Variable Cost May Be Defined As