Variable Costs

question 27

Multiple Choice

Variable costs:

• A)change as the quantity of output changes.
• B)are zero when production is zero.
• C)are exemplified by direct labour and raw materials.
• D)All of the above.
• E)None of the above.

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Definitions:

Strict Liability

A legal principle that holds parties responsible for damages or harm caused by their actions, without the need for proving negligence or fault.

Obstacles to Recovery

Factors or circumstances that hinder or prevent an individual or entity from recovering from a loss or injury.

Section 402A

A section of the Restatement (Second) of Torts that established the principle of strict liability for defective products, making manufacturers and sellers liable for damages caused by defective products.

Implied Warranty of Fitness

A legal assumption in many jurisdictions that a product sold will be suitable for the particular purpose for which the buyer intends to use it.