Multiple choice

Directions: Choose the correct option for the given question.

______ will move up by jumps, if output exceeds the capacity.

  1. Variable cost

  2. Fixed cost

  3. Work cost

  4. Factory cost

  5. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Step costs, often associated with fixed costs, remain constant over a certain range of activity but jump to a higher level once that capacity is exceeded. This is typical of fixed costs that require additional investment at specific thresholds.

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