Final answer:
The statement 'Property taxes and depreciation expense are examples of variable costs' is false. (option B)
Step-by-step explanation:
Property taxes and depreciation expenses are fixed costs & not variable costs because they do not change with the level of production. Property taxes are generally considered fixed costs because they do not vary with the level of production and are tied to property ownership, which does not frequently change. Depreciation expense is also a fixed cost as it is the allocated expense of a tangible asset over its useful life, and does not vary with production levels.
Variable costs, on the other hand, are costs that vary directly with the level of production, such as costs for labor or raw materials. For instance, as production increases, more raw materials and labor hours are typically required, thus increasing the variable costs. Since property taxes and depreciation do not change with the level of production, they cannot be classified as variable costs.