Which statement best describes cost behaviour?
A)In the long run,all costs are fixed.
B)Variable costs decrease in total in relation to the activity driver.
C)Total fixed costs increase or decrease inversely in relation to the activity driver.
D)Unit variable cost remains the same in relation to the activity.

Question

Quizplus · Accepted Answer

Unit variable cost remains constant with changes in the level of activity. This means that for each unit produced, the cost associated with that unit does not change, even though the total variable cost will change in direct proportion to the level of production or activity.

Which Statement Best Describes Cost Behaviour