Entity: FIXED-COST
Fixed-cost refers to business expenses that remain constant regardless of the level of goods or services produced. These expenses are recurring and typically not directly tied to production volume.
Fixed-Cost
Etymology
The term 'fixed-cost' originates from the concept of costs that are set and unchanging.
Definition
A fixed cost is a business expense that remains constant and does not vary with short-term changes in production. It includes expenses such as rent, interest payments, insurance, depreciation, and property tax.
Historical Context
Fixed costs have been a fundamental concept in accounting and economics, providing businesses with a clear understanding of their recurring expenses.
Cultural Significance
Understanding fixed costs is crucial for businesses to accurately budget and plan for financial stability.
Related Concepts
Fixed costs are related to concepts such as variable costs, total costs, and cost-volume-profit analysis.
See Also
A fixed cost is a business expense that remains constant and does not vary with short-term changes in production.