ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Fixed expenses, such as rent, stay the same from month to month. Variable expenses are ones that can change, such as gas or food. Cutting costs on fixed expenses can help you save money by lowering your overall bills.

Detailed explanation-2: -Fixed expenses generally cost the same amount each month (such as rent, mortgage payments, or car payments), while variable expenses change from month to month (dining out, medical expenses, groceries, or anything you buy from a store).

Detailed explanation-3: -Variable costs are any expenses that change based on how much a company produces and sells. This means that variable costs increase as production rises and decrease as production falls. Some of the most common types of variable costs include labor, utility expenses, commissions, and raw materials.

Detailed explanation-4: -A variable expense is a cost that alters in conjunction with some type of activity. For example, the direct materials expense increases as sales increase. Other variable expenses are commissions, billable labor, piece rate labor, and credit card fees. A business has few truly variable expenses.

Detailed explanation-5: -Variable cost is sometimes referred to as “unit-level cost” because it varies per unit of output-that is, according to the number of units produced.