Which of the following statements about a firm's short-run variable costs is correct?
A) They increase as the level of output decreases.
B) They typically include the cost of workers' wages.
C) They include the costs of plant and equipment.
D) They are always a greater expense than are fixed costs.

Question

Quizplus · Accepted Answer

Short-run variable costs typically include the cost of workers' wages, as these costs vary directly with the level of output. Option A is incorrect as short-run variable costs typically increase as the level of output increases. Option C is incorrect as the costs of plant and equipment are typically considered fixed costs. Option D is also incorrect as fixed costs are usually a greater expense than variable costs in the long run, but not necessarily in the short run.

Which of the Following Statements About a Firm's Short-Run Variable