Which of the following best describes a variable cost?
A) Per unit cost decreases as activity increases and increases as activity decreases
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

A variable cost is one that changes in total with changes in the level of activity, but the per unit cost remains constant.

Which of the Following Best Describes a Variable Cost