ECONOMICS

Detailed explanation-1: -The statement, “Fixed costs vary with the level of production or sales volume.", is false. The statement is false because the total fixed cost remains the same within a relevant range of production. The total fixed cost does not change even with the change in production levels.

Detailed explanation-2: -Fixed costs are costs that do not change when sales or production volumes increase or decrease. This is because they are not directly associated with manufacturing a product or delivering a service. As a result, fixed costs are considered to be indirect costs.

Detailed explanation-3: -A fixed cost is a cost that remains constant; it does not change with the output level of goods and services. It is an operating expense of a business, but it is independent of business activity. An example of fixed cost is a rent payment.

Detailed explanation-4: -Fixed costs do not vary with the production level. Total fixed costs remain the same, within the relevant range. However, the fixed cost per unit decreases as production increases, because the same fixed costs are spread over more units.

Detailed explanation-5: -Answer and Explanation: The correct answer is option B. Fixed costs are constant in total, and variable costs are constant per unit.