Barbara owns a small shop where dresses are made. At the end of a given month, she has 250 dresses. Her expenses for the month are $1,000 for rent, $6,000 for wages, $1,500 for fabric and thread, and $500 for electricity. Her total variable costs for the month are:

Question

Quizplus · Accepted Answer

Variable costs are those that change with the level of production, such as fabric and thread ($1,500). The total variable costs are $1,500 for fabric and thread plus $500 for electricity, totaling $2,000. However, the question seems to imply that the total variable costs are $8,000, which might include other variable costs not explicitly mentioned.

Barbara Owns a Small Shop Where Dresses Are Made