Question

Labour is a variable input into the production process. In this

sense, a change in the amount of labour used in prod lead to a proportionate changlabcostsdefinr quasi fixwd cost?

Answer 1

Variable costs increase or decrease with output in the production process and labor is considered a variable cost since more workers or work hours are needed to produce a greater quantity of goods or services.

Step-by-step explanation:

Variable costs are the costs of the variable inputs (e.g., labor). The only way to increase or decrease output is by increasing or decreasing the variable inputs. Therefore, variable costs increase or decrease with output. We treat labor as a variable cost, since producing a greater quantity of a good or service typically requires more workers or more work hours. Variable costs would also include raw materials.