Fixed Costs That Do Not Differ Between Two Alternatives Are

question 247

Multiple Choice

Fixed costs that do not differ between two alternatives are

• A)irrelevant to the decision.
• B)considered opportunity costs.
• C)relevant to the decision.
• D)important only if they represent a material dollar amount.

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Definitions:

Proportional

A concept where elements are in a constant relationship in terms of size, amount, or number relative to a whole.

Regressive

Describing a tax system where the tax rate decreases as the taxpayer’s income increases, placing a larger burden on lower-income individuals.

Taxable Income

Taxable income is the portion of your gross income that's subject to taxes after deductions and exemptions.

Tax Liability

The total amount of tax owed to the government after all deductions, credits, and prepayments have been taken into account.