What term is used to describe costs that remain fixed over a certain range of output but suddenly jump to a new higher level when output goes beyond…

CA Foundation · Business Economics · PYQS · September 2024
What term is used to describe costs that remain fixed over a certain range of output but suddenly jump to a new higher level when output goes beyond a given limit ?
(A) A. Semi-variable cost
(B) B. Variable cost
(C) C. Stair-step variable cost
(D) D. Sunk cost

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. Stair-step variable cost

Topics: Theory of Production and Cost

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