Define variable costs. Explain the behaviour of total variable cost as output increases.

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Solution

Variable costs refers to costs which are incurred on variable factors. For instance, wages for labour is a variable cost.

TVC generally rises with increasing output.

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Define variable costs. Explain the behaviour of total variable cost as output increases.

Variable costs refers to costs which are incurred on variable factors. For instance, wages for labour is a variable cost. TVC generally rises with increasing output.

Variable costs refers to costs which are incurred on variable factors. For instance, wages for labour is a variable cost.

TVC generally rises with increasing output.