_____ Per Unit Increases or Decreases in Inverse Proportion to Its

question 35

Multiple Choice

_____ per unit increases or decreases in inverse proportion to its activity level.

• A) Variable cost
• B) Opportunity cost
• C) Contribution cost
• D) Fixed cost

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Definitions:

Pollution Costs

Environmental and financial costs resulting from the harmful effects pollutants have on the natural environment and human health.

Polluting Good

A product or service that when produced or used, negatively impacts the environment by releasing harmful substances.

Optimal Amount

The most favorable level of a certain variable, considering conditions that maximize efficiency or outcomes.

External Benefits

Advantages or positive effects that a transaction or activity provides to people not directly involved in it.