In Contrast to a Variable Cost

question 150

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

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Definitions:

Consumption Function

An economic formula representing the functional relationship between total consumption and gross national income.

Aggregate Income

The total income earned by all individuals and entities within an economy.

Aggregate Consumption

The total amount of goods and services consumed in an economy within a given period.

Consumption Function

A mathematical expression describing the association between gross national income and the total amount spent on consumption.