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InterviewSolution
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Define Fixed Cost? |
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Answer» A fixed cost is one that does not change in TOTAL within a reasonable range of activity. For EXAMPLE, the rent for a PRODUCTION FACILITY is a fixed cost if the rent will not change when there are reasonable changes in the amount of output or input. If there is a need to double the output the rent will change when the company occupies additional work space. A fixed cost is one that does not change in total within a reasonable range of activity. For example, the rent for a production facility is a fixed cost if the rent will not change when there are reasonable changes in the amount of output or input. If there is a need to double the output the rent will change when the company occupies additional work space. |
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