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The cost which remains fixed per unit of output is : a. Fixed Cost b. Variable Cost

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Question added by Deleted user
Date Posted: 2014/09/06
Ahmed Abdi Mahad
by Ahmed Abdi Mahad , Director of Internal Auditing Directorate , Jigjiga University

Variable cost is the cost that varies in total but remains fixed in per unit. In other words as the number of units increase their total costs also increase but even if the total number of units increase their unit price does not change and will remain fixed. 

On the other hand, fixed cost is the cost that remains constant in total but varies in per unit. It is the cost that you must pay regardless of weather you produce some thing or not.  However, its per unit cost (fixed costs per unit) will decrease as the number of your production increases and vice - verse.

So, the answer for your question is choice B (Variable cost)

Imran Adwani
by Imran Adwani , Head of Internal Audit , Abdulla Bin Zayed Investment Group

Variable Cost is always fixed per unit of output but it is called variable since it varies with the no. of units produced.

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