A variable cost

Name: A variable cost
Brand: Quizplus
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Question

A variable cost

Quizplus · Accepted Answer

Variable costs change proportionally with changes in operating activity. As the activity level increases, variable costs increase proportionally and vice versa. Option A is incorrect because the term "inverse proportion" is not applicable to variable costs. Option B is incorrect because variable costs change in the same direction, not the opposite direction. Option D is incorrect because variable costs are not limited to labor costs.

A Variable Cost