Cost of Production

Gap-fill exercise

Fill in all the gaps, then press "Check" to check your answers.You have 6 minuts to attempt this exercise.
   Fixed costs      horizontal      loan      machine hire      output      total costs      upward      variable      Variable costs   
The of any firm are made up of their fixed costs and variable costs. are those costs which do not vary with the level of output. For example, if a firm rents a factory for $200 per week, this cost is the same whether it produces 200 items or 1000 items. Other examples of fixed costs include , telephone bills, heating and repayments.
are those expenses which do not vary directly with the level of . The buying of materials to make goods will be a cost.
Wages will also increase if workers have to work longer hours to produce more, or if more labour is hired by a firm. Variable costs appear as an sloping line on a graph whereas fixed costs appear as a straight line on a graph.