Fixed cost is a cost:
Last updated Jun 24, 2026
Correct Answer:
Option C —
Which do not change in total during a given period despise changes in output
Understanding Fixed Costs Fixed costs are expenses that remain constant regardless of how much a company produces or sells. Even if the business produces zero units, these costs must still be paid.
Total Fixed Cost (TFC): Stays the same in total ($1,000$ in rent is $1,000$ whether you make $1$ shirt or $100$ shirts).Fixed Cost Per Unit: This actually decreases as production increases, because the same total cost is spread over more units (this is a key part of "economies of scale").
Why the other options are incorrect:
A: This describes Variable Costs (e.g., raw materials).
B: This describes Semi-variable or Mixed Costs (e.g., a utility bill with a fixed base charge plus a usage fee).
D: This is incorrect because as you produce more, the fixed cost "per unit" actually goes down.
Answer verified by Quintessence Classes faculty — Karan Nagar, Srinagar.
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