Another way of addressing slippery rail is to wait until it begins to develop. Then the company purchases sand and dumps it on the slippery tracks so that trains already en route within the rail network can proceed. If​ incurred, would this railroad expense be a better example of a fixed cost or a variable​ cost? Why?

Question

Part 5
A.
This is an example of a fixed cost because it is a​ short-run cost.
B.
This is an example of a variable cost because the cost varies with the number of trains.
C.
The cost can be either fixed or variable depending on whether we are talking about the short run or long run.

Answer 1

B. This is an example of a variable cost because the cost varies with the number of trains.