Question

The fixed costs are also referred to as _____________.

• A. overhead costs
• B. supplementary costs
• C. implicit costs
• D. both (a) and (b)

Answer 1

The correct option is D both (a) and (b)

The fixed costs are also referred to as overhead costs and supplementary costs .

Fixed costs are those costs which are independent of the output. It is also called overhead cost of production because these costs decline per unit of output with increase in production.

Fixed cost are also called supplementary costs because these cost constitute a small proportion of the total cost of production.