Which of the Following Is an Example of a Cost

question 73

Multiple Choice

Which of the following is an example of a cost incurred in generating higher levels of GDP per capita?

• A) A high level of investment in infrastructure.
• B) An increase in worker productivity from improved health and education services.
• C) A high number of hours worked per week.
• D) An increase in innovation that aids the development of new products.

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Definitions:

Variable Cost

Costs that vary depending on the amount of goods produced or the scale of operations in a business.

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business within a certain period, such as rent, salaries, and insurance.

High-low Method

A technique used in cost accounting to estimate variable and fixed costs based on the highest and lowest levels of activity.

Variable Cost

Costs that vary in proportion to the level of production or business activity, such as materials and direct labor.