Which of the following is a variable cost in the short run ?
Correct answer: B. wages paid to factory labor
- A. rent on the factory
- B. wages paid to factory labor
- C. interest payments on borrowed financial capital
- D. payments on the lease for factory equipment
- E. salaries paid to upper management
Explanation
Factory labour wages usually vary with the quantity produced or hours worked, making them a variable cost in the short run. Rent, equipment leases, and similar obligations are normally fixed during that period.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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