Question

Marcella operates a small, but very successful art gallery. All but one of the following can be classified as a variable cost arising from the physical inputs Marcella requires to operate her business. Which is it?
a. physical space for the gallery
b. costs of purchasing art work to sell in the gallery
c. wages paid to three part-time employees
d. accountant's fees for preparing tax returns

Answer 1

Answer:

The right option is (A)

Explanation:

Marcella operates an art gallery which is small but successful. Similarly, the space used by Marcella for the art gallery is the variables cost which is necessary to operate her business. Without an art gallery, she can not run her business and that is why it is the variable cost which she has to bear in order to run her operations.