The variable costs will increase or decrease with an increase in production.
A variable cost could be a corporate expense that changes in the extent to how much a company produces or offers. Variable costs increment or decrease depending on a company's generation or sales volume. When production or deals increment, variable costs increment; when generation or deals decrease, variable costs decrease. Variable costs stand in differentiate from settled costs, which don't alter the extent of production or sales volume. Variable costs are a central portion in deciding a product's contribution margin, the metric utilized to decide a company's break-even or target profit level.
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