In Contrast to a Variable Cost

question 12

Multiple Choice

In contrast to a variable cost,

• A)the total amount of a fixed cost does not change with activity level.
• B)the total amount of a fixed cost increases as activity increases.
• C)the per unit amount of a fixed cost does not change with activity level.
• D)the per unit amount of a fixed cost increases as activity increases.

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Definitions:

Exploitation

Utilizing resources or people in an unfair or unethical manner for one's own benefit, often underpaying or overworking them.

Barter

A system of exchange where participants in a transaction directly exchange goods or services for other goods or services without using a medium of exchange, such as money.

Benevolence

the inclination to perform kind, charitable acts towards others without expecting anything in return.

Circular-Flow Diagram

A visual model of the economy showing the interactions between households and businesses through the markets for products and resources.