ICSE Class X Commercial Applications 2020 Solved Papers
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Question : 15
Total: 32
What do you mean by Semi-fixed cost? Give an example.
Solution:
Semi-fixed Costs : Semi fixed costs are those costs which vary but not in direct proportion to changes in the volume of produc-tion. They are the combination of fixed and variable costs. Such costs are neither perfectly fixed nor absolutely variable. The fixed component of such costs represents the cost of providing capacity and the variable component is carried by using the capacity. For example, the rent of a telephone is a fixed cost whereas the charges for calls made during a month are a variable cost.
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