ECONOMICS

Detailed explanation-1: -Fixed costs are considered indirect costs of production, which means that they are not costs incurred directly by the production process, such as parts needed for assembly.

Detailed explanation-2: -Direct costs are typically variable costs, which means the cost fluctuates based on the production volume-i.e. projected product demand and sales. Indirect costs, on the other hand, tend to be fixed costs, so the expense amount is independent of the production volume.

Detailed explanation-3: -Much like direct costs, indirect costs can be fixed or variable. Fixed indirect costs include expenses such as rent; variable indirect costs include fluctuating expenses such as electricity and gas.

Detailed explanation-4: -Direct costs can also be fixed costs, such as rent payments that are directly tied to a production facility. Also, salaries of mangers or supervisors might also be included in direct costs, particularly if they’re tied to a specific project.