Question

Suppose Jan started up a small lemonade stand business last month. Variable costs for Jan's lemonade stand now include the cost of

a. building the lemonade stand.
b. hiring an artist to design a logo for her sign.
c. lemonade mix.
d. All of the above are correct.

Answer 1

Answer: C - Lemonade mix

Step-by-step explanation:

Variable costs are costs that varies with the quantity produced.

In the question, the variable cost is the cost of the lemonade mix. If Jan decides to increase the quantity of lemonade made, she would purchase more lemonade mix.

The cost of building the stand and hiring an artist are fixed costs. They do not vary with the quantity produced.

I hope my answer helps you.