3.1 Cost of producing the product

Card 1 of 23 0 got it 0 still learning

Question

TapClick or press space to see the answer

Answer

All 23 cards in this set

Which term describes costs that do not change no matter how many products are sold?: Fixed costs
What is meant by wages?: Pay for hourly work that varies with the level of output
What is meant by loan interest?: The charge on money borrowed that is paid each month
What is the name for the electricity, gas and water that a business must pay for?: Utilities
What is meant by total costs?: The fixed costs and variable costs of a business added together
Which term describes the total costs of a business divided by the number of units sold?: Total cost per unit
What is meant by variable costs?: Costs that change in line with the level of output
What is meant by a salary?: Pay set at a yearly amount and paid in equal monthly amounts
What is calculated by dividing total variable costs by the number of units produced?: Variable cost per unit
Which of these is a variable cost for a business?: Packaging
Why is advertising treated as a fixed cost?: It must be paid even if no sales are made
A business pays its manager a monthly salary and pays its packers by the hour. Which statement is correct?: Salary is fixed, wages are variable
A business repays £250 a month on a loan, of which £40 is interest. Which amount is a fixed cost?: The £40 of interest
Which of these is treated as a fixed cost, even though the amount used can rise with output?: Utilities
A business has fixed costs of £1,500 and variable costs of £2,300 for a month. What are its total costs?: £3,800
A business sells 1,000 units. Its fixed costs are £2,000 and its variable costs are £3,000. What is the total cost per unit?: £5
A business has total costs of £7,500 in March and variable costs of £3,000. What are its fixed costs?: £4,500
A business pays rent of £500 a month and insurance of £40 a month. What are its total fixed costs for one year?: £6,480
A business makes 400 units. Raw materials cost £3 per unit and packaging costs £1 per unit. What are its total variable costs?: £1,600
A business doubles the number of units it produces. What happens to its total fixed costs?: They stay the same
A business pays insurance of £1,200 a year and rent of £450 a month. What are its total fixed costs for one month?: £550
A business has monthly fixed costs of £2,400. It sells 400 units in April and 600 units in May. What is its fixed cost per unit in May?: £4
A business makes 250 units. Its total cost per unit is £8 and its variable cost per unit is £3. What are its total fixed costs?: £1,250

3.1 Cost of producing the product

Round complete