Final answer:
Rent on exhibit space is the cost represented by a horizontal line on a graph where the vertical axis is costs and the horizontal axis is the volume of activity, indicating it is a fixed cost.
Step-by-step explanation:
Assuming costs are represented on the vertical axis and volume of activity on the horizontal axis, the cost that would be represented by a line parallel to the horizontal axis is d. rent on exhibit space at a convention. This is because rent is typically a fixed cost, which does not change with the level of production or activity and is therefore constant regardless of the volume of activity. In contrast, total direct material costs (a), a consultant paid per hour with a maximum fee (b), and employees paid per hour with a minimum guaranteed wage (c) all change based on the volume of activity, and therefore, their respective costs would not be represented by a line parallel to the horizontal axis.
When graphing fixed costs, they are shown as the vertical intercept of the total cost curve, reflecting that these are the costs incurred even when the output is zero and there are no variable costs involved. The relationship between output and cost for variable costs such as labor or materials can then be graphically added to the fixed costs to obtain the total costs, which would not result in a horizontal line.