Question

Which of the following statements is true of a linear cost​ function? A. It presents total cost as an intercept. B. It presents variable cost as a slope coefficient. C. It presents variable cost as an intercept. D. It presents total cost as slope coefficient.

Answer 1

Answer:

Option B It presents variable cost as a slope coefficient

Explanation:

The reason is that the total cost function is:

Y = a + bx

The total cost in this case is Y, a is fixed cost as an intercept, b is variable cost represented as an slope and coefficient and x is level of activity which is independent of Y.

So the right answer is option B.