When Pepsi sells 1,000 cases of Pepsi, their cost per case is $0.30. However, when they sell 2,000 cases, their cost per case is $0.22. These costs are considered Pepsi's:
A)variable costs.
B)administrative costs.
C)marginal costs.
D)fixed costs.

Question

Quizplus · Accepted Answer

The cost per case changes based on the number of cases sold, indicating that the cost is variable and not fixed. Marginal costs refer to the cost of producing one additional unit, which is not relevant in this scenario. Administrative costs refer to overhead expenses such as salaries and rent, which are not related to the production or sale of Pepsi cases.

When Pepsi Sells 1,000 Cases of Pepsi, Their Cost Per