Which of the following is most likely a variable cost for a business?
A) payments for electricity
B) the lease payment on a warehouse used by the business
C) the loan payment on funds borrowed when a new building is constructed
D) the opportunity cost of the heavy equipment installed in a factory

Question

Quizplus · Accepted Answer

Payments for electricity are most likely a variable cost for a business because they will increase or decrease based on the level of production or usage. As production or usage increases, the cost of electricity will also increase.

Which of the Following Is Most Likely a Variable Cost