Which of the following statements is true regarding fixed and variable costs?
A) Both costs are constant when considered on a per-unit basis.
B) Both costs are constant when considered on a total basis.
C) Fixed costs are fixed in total, and variable costs are fixed per unit.
D) Variable costs are fixed in total, and fixed costs vary in total.

Question

Quizplus · Accepted Answer

Fixed costs do not change regardless of the number of units produced, while variable costs increase or decrease depending on the number of units produced. Therefore, fixed costs are fixed in total, and variable costs are fixed per unit.

Which of the Following Statements Is True Regarding Fixed and Variable