Instructions

Listed below are various terms describing fixed and variable costs. Consider whether each term is most likely to describe fixed costs or variable costs.

a)	Direct expenses	Choose... Fixed costs Variable costs
b)	These costs are represented by a sloping line on the total cost graph	Choose... Fixed costs Variable costs
c)	The cost of producing one more unit will be exactly the same as for all the previous units of production	Choose... Fixed costs Variable costs
d)	Production overheads	Choose... Fixed costs Variable costs
e)	These costs are represented by a horizontal line on the total costs graph	Choose... Fixed costs Variable costs
f)	Indirect overheads	Choose... Fixed costs Variable costs
g)	Increase or decrease directly in line with rises and	Choose... Fixed costs Variable costs
h)	falls in production	Choose... Fixed costs Variable costs
i)	Direct materials Cannot be allocated directly to units of production Do not change when the number of units produced changes	Choose... Fixed costs Variable costs

 

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