Which of the Following Is an Example of a Cost

question 24

Multiple Choice

Which of the following is an example of a cost that varies in total as the number of units produced changes?

• A)Electricity per KWH to operate factory equipment
• B)Monthly rent on a factory building
• C)Straight-line depreciation on factory equipment
• D)Salary of a production supervisor

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Definitions:

Risk Involved

The potential for losing something of value or the possibility of a negative outcome in a given decision or action.

Loan Interest

The cost paid by the borrower to the lender for the use of borrowed money, typically expressed as an annual percentage of the loan amount.

Loanable Funds

Refers to the funds available for borrowing in the financial markets, determined by the savings of households and organizations.

Public Debt

The total amount of money owed by the government to creditors, often as a result of borrowing to finance public spending.