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What are the constituents of cost ? |
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Answer» The constituents of cost are: 1.Fixed Cost – It is the cost of fixed inputs used in production. These costsdo not vary with the change in volume of production. 2.Variable Cost – It is the cost of variable inputs used in production. Thesecosts vary with the change in volume of production. 3.Semi Variable Cost – It refers to costs which are partly fixed and partlyvariable. These types of cost do not directly affect the level of productionbut may vary with change in production facilities e.g. administrative cost,maintenance cost, depreciation cost etc. 4.Total Cost – It refers to the total cost of production |
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