Select the Correct Statement Regarding Fixed Costs

question 7

Multiple Choice

Select the correct statement regarding fixed costs.

• A) Because they do not change, fixed costs should be ignored in decision making.
• B) The fixed cost per unit decreases when volume increases.
• C) The fixed cost per unit increases when volume increases.
• D) The fixed cost per unit does not change when volume decreases.

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Definitions:

Arrival Rate Distribution

Statistical representation describing the frequency and pattern of arrivals at a service system over a specific period.

Service Time Distribution

The statistical distribution of the time taken to serve customers in a queue, affecting waiting times and service efficiency.

Number of Channels

Refers to the distinct paths or routes through which a company distributes its products or services to customers.

Number of Phases

refers to the distinct stages in a project, process, or lifecycle, often marked by key milestones or transitions.