A linear cost equation
A) is derived from two elements - the relevant range and the level of activity.
B) is used to estimate future costs.
C) includes three components - fixed costs, variable costs and mixed costs.
D) is fixed when the volume is zero and increases at a constant rate per activity level after that.

Question

Quizplus · Accepted Answer

A linear cost equation is used to estimate future costs by expressing total costs as a function of fixed and variable costs.

A Linear Cost Equation