Discover the differences between fixed and variable costs and how they impact production costs. Learn to analyze these costs ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

The world of microeconomics and business decision-making hinges upon a key concept: marginal cost. In the simplest terms, marginal cost represents the expense incurred to produce an additional unit of ...

Every business has operating expenses — that is, the costs of running the business. These expenses can generally be classified in two ways: Fixed expenses and variable expenses. Understanding the ...

A change in demand affects your sales and impacts your variable costs. As your sales grow, your variable costs increase. As your sales fall, your variable costs decrease. If you raise or lower your ...

In economics, fixed costs and variable costs are two separate components of total cost. Examining the two separately can be useful to demonstrate how much of a company's costs are tied to its level of ...