Asked by Katherine Roman on Jul 09, 2024
Verified
A cost that changes with volume, but not at a constant rate, is called a:
A) Variable cost.
B) Curvilinear cost.
C) Step-wise variable cost.
D) Fixed cost.
E) Differential cost.
Curvilinear Cost
A cost behavior pattern where costs increase with activity, but not at a constant rate, often depicted as a curved line on a graph.
Variable Cost
Costs that change in proportion to the level of activity or volume of production in a company.
- Define and differentiate between various types of costs (e.g., step-wise, curvilinear) in the context of their behavior as volume changes.
Verified Answer
AF
António FelgueirasJul 12, 2024
Final Answer :
B
Explanation :
A cost that changes with volume, but not at a constant rate, is known as a curvilinear cost. This cost is best represented by a curved line on a graph, as opposed to a straight line for a variable cost or a horizontal line for a fixed cost. Step-wise variable costs refer to costs that increase in steps as volume increases, while differential costs refer to costs that differ between alternatives.
Learning Objectives
- Define and differentiate between various types of costs (e.g., step-wise, curvilinear) in the context of their behavior as volume changes.