Which of the following best describes a fixed cost?
A) Per unit cost decreases as activity decreases and increases as activity increases
B) Total cost decreases as activity increases and increases as activity decreases
C) Per unit cost remains the same regardless of activity
D) Total cost remains the same regardless of activity

Question

Quizplus · Accepted Answer

Fixed costs are costs that do not change with the level of output or activity. This means the total cost remains constant regardless of changes in production volume or sales activity.

Which of the Following Best Describes a Fixed Cost