Q&A - What are variable costs?
Recommend on Google+
Costs which change when output changes are called “variable costs”
Variable costs tend to be those relating directly to the production or sale of a product. Good examples include:
- Raw materials
- Bought-in stocks and components
- Wages based on hours worked or amount produced
- Marketing costs based on sales (e.g. % discounts offered on a sales price)
- Agent and other commissions
Total variable costs can be calculated by a simple formula:
Variable cost per unit x output
Tags: price, costs, production, fixed costs, variable costs, output
blog comments powered by Disqus
Revision Presentation - Marketing Mix: Introduction to Pricing [17 May 2012]
Revision Presentation - Calculating and Measuring Profit [13 May 2012]
Legislation forces Coke and Pepsi to change their recipe [9 Mar 2012]
Barriers to entry for business expansion to Brazil [23 Feb 2012]
Revision Presentation - Cost Minimisation [3 Jan 2012]
Revision Presentation - Workforce Planning [26 Dec 2011]
The Rise and Fall and Rise of Gerald Ratner [27 Nov 2011]
Cut price cup cake deal goes wrong…... [22 Nov 2011]
Unilever hit by rising costs [6 Nov 2011]
How PepsiCo are trying to control diseconomies of scale [18 Oct 2011]
Revision Quiz - Breakeven Basics [15 Oct 2011]
Revision Quiz - Costs, Revenues and Profits [12 Oct 2011]
Revision Quiz - Business Costs [12 Oct 2011]
Lesson Worksheet - Business Costs [12 Oct 2011]
Where there’s muck there’s brass [6 Jul 2011]
British manufacturer exploiting a niche [21 Jun 2011]
An end to outsourcing? [18 May 2011]
Retrenchment in action - Comet turns off the retail lights [12 May 2011]
Using Chucklevision to Teach Business [8 May 2011]
Lesson Worksheet - Capacity Utilisation [5 May 2011]
Revision games - Marketing Basics (True / False) [16 Feb 2011]
The Year of Corporate Philanthropy [31 Jan 2011]
An idea that’s a lot of hot air…. [11 Jan 2011]
Q&A - Distinguish between price and cost [2 Jan 2011]
Q&A - Should a business use a “loss leader” as part of its pricing tactics? [31 Dec 2010]
A retailer’s worst nightmare - where are the customers? [20 Dec 2010]
Dominos Pizza - Growth & Strategy (Part 3) - Smart Marketing [26 Nov 2010]
Dominos Pizza - Growth & Strategy (Part 2) - Innovation, Service and Smart Operations [26 Nov 2010]
Segmentation & Pricing - the Ice-Cream Price Pyramid [17 Nov 2010]
Cash flow Clue-doh! The Mystery is Revealed… [2 Nov 2010]
Profits up at Amazon - but so are costs [22 Oct 2010]
Making the FT Brand Sweat! [19 Oct 2010]
Rationalising & Redeployment at Alliance Boots [9 Oct 2010]
The business cost of labour turnover [7 Oct 2010]
Pricing Strategy - Mobile Data Networks [14 Sep 2010]
Would you stand for it? [14 Sep 2010]
Inflation and profit margins - lessons from the market [27 Aug 2010]
Lessons from the business model of King & Allen [13 Jul 2010]
Dark days for the UK nightclub market [21 Jun 2010]
Strategy Case Study - Vauxhall/Opel restructuring [24 May 2010]
British vodka beats the world! [19 May 2010]
Revision Quiz - Using Breakeven Analysis in Decision-making [5 Apr 2010]
Taking Demand-based Pricing To Extremes [8 Feb 2010]
Video case study - substitute goods benefiting from the recession [1 Feb 2010]
Business priorities in a recession [1 Feb 2010]
Flexible working thrives in the recession [1 Feb 2010]
What business students can learn from how businesses have handled the recession [1 Feb 2010]
Product, pricing and profitability in a changing market [20 Jan 2010]
Revision Presentation - Cost Basics [30 Dec 2009]
Revision Presentation - the Basics of Profit [30 Dec 2009]
Revision Presentation - Revenues and Demand [30 Dec 2009]
Q&A - When is it appropriate for a firm to use penetration pricing? [21 Dec 2009]
Q&A - Explain price skimming [21 Dec 2009]
Q&A - What is the difference between pricing strategies & tactics? [21 Dec 2009]
Q&A - Explain what is meant by price positioning [21 Dec 2009]
Q&A - What factors should a business consider when setting its prices? [19 Dec 2009]
Q&A - How does pricing link to the objectives of a business? [19 Dec 2009]
Q&A - What is price and why is it so important in the marketing mix? [19 Dec 2009]
Outdoor Ice-skating heads firmly down the product life cycle [3 Dec 2009]
Operations in Action - Video Tour of the Amazon Depot [23 Nov 2009]
A tale of two bakers [16 Nov 2009]
Emerging markets drive demand for oil [16 Nov 2009]
Innocent Drinks - Teaching Accounts Exercise [9 Nov 2009]
Brompton Bicycles - Guardian Profile [9 Nov 2009]
Santa goes back to basics in attempt to reduce the cost of Christmas [29 Oct 2009]
Q&A - What is globalisation? [27 Oct 2009]
Q&A - How are businesses affected by unemployment? [27 Oct 2009]
Q&A - What are the main causes of unemployment? [27 Oct 2009]
Managing Cash Flow - Beware the Economic Recovery [26 Oct 2009]
Economist on Lean Production [20 Oct 2009]
Pricing strategies and tactics under investigation [15 Oct 2009]
Dyson launches a new premium product [14 Oct 2009]
Ukraine 1 England 0 - A match to remember? [12 Oct 2009]
Napster - Trying to compete, or getting desperate? [9 Oct 2009]
The Decline of Newspapers Creates a Surge in Local Startups [4 Oct 2009]
V-Water - from start up to exit [4 Oct 2009]
The lights go out for the nightclub market [26 Sep 2009]
Todd Stitzer’s Strategic Test [14 Sep 2009]
Beat the Teacher - Introduction to Costs [14 Sep 2009]
Patent Theft threatens enterprising inventors [3 Sep 2009]
Sony cuts the PS3 price to extend its life cycle [30 Aug 2009]
More trouble in the skies [27 Aug 2009]
Plastic car is a blast from the past [25 Aug 2009]
Sainsbury’s and Diageo pitch in to battle [17 Aug 2009]
Own label brands profit from the recession [4 Aug 2009]
Demand and supply in action - tea prices surge [4 Aug 2009]
The Death of Newspapers - to be replaced by Nichepapers? [2 Aug 2009]
BA cuts out the cost of short-haul meals [29 Jul 2009]
Product life cycle - end of the line for Teletext [17 Jul 2009]
How to improve profitability? - give customers a “staff appraisal” [12 Jul 2009]
Batch production in action - cricket bats [12 Jul 2009]
What makes a profitable menu? [6 Jul 2009]
Standing room only - on Ryanair? [6 Jul 2009]
Instore Takes a Pounding [6 Jul 2009]
Swimsuit malfunction - a failure of quality or just the wrong size? [2 Jul 2009]
U2 on Tour - Investment appraisal and capacity utilisation rolled into one! [2 Jul 2009]
Stock control - de-stocking was over £5bn in Q1 of 2009 [2 Jul 2009]
Q&A - Outline the main costs and benefits of inflation [1 Jul 2009]
Q&A - Explain the causes of inflation [1 Jul 2009]
Q&A - What is inflation and how is it measured? [1 Jul 2009]
BUSINESS TEACHER RESOURCE NEWSLETTER
Get first news of business teaching resources, ideas and other materials from tutor2u. Over 9,400 business teachers from the UK and around the world receive our regular teacher email newsletters. Sign up for free here!



