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States the term fixed cost in briefly

States the term fixed cost in briefly.

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Fixed Cost:

This cost is those costs that do not vary with the volume of production. Fixed costs stay fixed or constant up to an exact level of production. Even though the production is zero that a firm will have to incur fixed costs. Illustrations are rent, depreciation, interest, insurance and salaries. The fixed costs are as well termed as supplementary costs; period costs capacity costs or overhead costs.

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