Suppose you are charged a $10 per month base charge for your electrical service.You are also charged an additional $0.08 for every kwh of electricity you use.The cost is an example of a
A)variable cost.
B)fixed cost.
C)mixed cost.
D)step cost.

Question

Quizplus · Accepted Answer

The base charge of $10 per month is a fixed cost, as it remains the same regardless of the amount of electricity used. However, the additional charge of $0.08/kwh varies with the amount of electricity used, making it a variable cost. Therefore, the overall cost is a mixture of fixed and variable costs, making it a mixed cost.

Suppose You Are Charged a $10 Per Month Base Charge