A graph with the amount of some cost driver on the "x" axis and the cost of production on the "y" axis that is a straight line, with an upward slope, starting at the origin, would indicate which type of cost relationship?
A) Fixed responsiveness
B) Proportional responsiveness
C) Semi-variable costs
D) Step costs

Question

Quizplus · Accepted Answer

A straight line with upward slope starting at the origin indicates a proportional relationship between the amount of cost driver and the cost of production. This means that as the amount of cost driver increases, the cost of production will increase proportionally at a constant rate.

A Graph with the Amount of Some Cost Driver on the "X