If the Level of Activity Increases

question 41

Multiple Choice

If the level of activity increases,

• A)variable cost per unit and total fixed costs increase.
• B)fixed cost per unit and total variable cost increase.
• C)total cost will increase and fixed cost per unit will decrease.
• D)variable cost per unit and total cost increase.

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Definitions:

Rental Payment

The amount paid periodically by a tenant to a landlord in exchange for the use of property or land.

Primarily Rental Property

Real estate that is predominantly used for rental to others, rather than as the owner's primary residence.

Schedule E

A form used by the IRS for taxpayers to report income and losses from rental property, royalties, partnerships, S corporations, estates, and trusts.

Royalties

Payments made to the owners of intellectual property, such as authors, composers, and inventors, for the rights to use their intellectual property.