diffreniate between fixed cost and variable cost by giving examples???
Answers
Total Fixed Cost Total Variable Cost
Those cost which do not vary directly Those cost which vary directly with
with the level of output. level of output.
Cannot be changed in short run. Can be changed in short run.
Can never be 0, even if there is no It is 0 when there is no production.
production.
Incurred on fixed factors like land, Incurred on variable factors like
building, etc. labour, raw materials, etc.
TFC curve is a horizontal straight TFC Curve is inversely S-shaped
line parallel to x-axis. curve.
Ex- wages of casual labours, Ex- salary of permanent staff,
payment of raw materials, etc. insurance premium, building rent,
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