One of the mysteries of the English language finally explained.
A cost that varies with the level of output.
- ‘They have to identify their variable costs, then calculate the money they can save or the new sales they can log adding technology.’
- ‘Examples of common fixed costs are insurance and depreciation while variable costs include direct labor, raw materials and utilities.’
- ‘Auto suppliers gained longer-term contracts, but paid a stiff price in terms of taking on more fixed costs and a constant struggle to match variable costs to price cuts.’
- ‘This drop in variable costs has helped to lift profit margins.’
- ‘With the yen at these levels, Japanese exporters could not even cover their variable costs, let alone return a profit on sales in international markets.’
- ‘The thing that worries us is that VisitScotland has substantial fixed costs and the only area where there are variable costs is in the marketing.’
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