Question

Raw materials are an example of a firm's ____ costs. answer

Answer 1

Answer:

d. variable

Explanation:

• As the raw material are a direct cost to the company they are termed as a fixed cost as they are the assets of the production and consumption. But their availability is subject to a matter of use thus they are categorized as a variable cost to the resources of the company or firm.

• An example is that o the wood as a raw matter has to be produced as finished goods thus the amount of seasonal wood available for the construction activities to take place is another cost to the company.

• Hence the erw matter is seen as a variable cost.

Answer 2

Raw materials are an example of a firm's explicit costs. Another term for explicit costs are fixed costs meaning that they are directly needed to run a business.