ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -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-2: -Examples of Fixed Expenses Mortgage or rent payments. Loan payments, such as auto loans or student loans. Insurance premiums, such as for car insurance and homeowners insurance. Property taxes.

Detailed explanation-3: -Key Takeaways A fixed expense is a bill that doesn’t change from month to month. Your monthly mortgage payment, insurance premiums, and childcare costs are examples of fixed expenses. Fixed expenses can occur weekly, monthly, quarterly, or annually. Variable expenses change from month to month, depending on usage.

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: -Fixed expenses: These are the necessary expenses that remain the same each month, including your rent, car payment, and insurance.