Which of These Is an Example of a Fixed Cost

question 9

Multiple Choice

Which of these is an example of a fixed cost?

• A) Factory rental
• B) Factory bonuses linked to the level of production
• C) Packaging costs
• D) Raw materials

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Definitions:

Coordination

The process of organizing people or groups so that they work together properly and well.

Profit Centers

Divisions within a company that are treated as separate business units, with their performance measured based on their ability to generate profit.

Transfer Price

The price at which goods and services are sold between divisions within the same company or different companies under the same ownership.

Upstream Division

A segment of a company or industry involved in the early stages of production or supply chain, often dealing with raw materials.