Question

If a cost's step-cost behavior follows very narrow steps, the costs may be approximated using:

(A) fixed costs assumptions.
(B) step-fixed cost assumptions.
(C) straight variable cost assumptions.
(D) mixed cost assumptions.

Answer 1

Answer:

The correct answer is (C) straight variable cost assumptions.

Explanation:

If the total cost increases with small increases in activity, it may be referred to as a step-variable cost.