Final answer:
Typical cost drivers include machine depreciation, flight-hours, machine-hours, utilities cost, and computer time, all of which can impact the cost of technology and influence a firm's decision on the preferred production technology.
Step-by-step explanation:
Typical cost drivers include various factors that cause the costs of an activity to increase or decrease. The correct options from the provided list are:
- Machine depreciation: The loss of value of machinery over time due to use and obsolescence.
- Flight-hours: In the context of aviation, the number of hours an aircraft is in flight which can drive fuel and maintenance costs.
- Machine-hours: The total hours that machines are operating, affecting costs related to wear and tear, maintenance, and electricity.
- Utilities cost: The cost associated with utilities such as electricity and water that are consumed during operations can be a significant driver, particularly in energy-intensive settings.
- Computer time: The duration for which computers are used, affecting the cost of electricity and potential maintenance requirements.
This understanding aligns with the concept that the cost of technology and its associated drivers can impact the total cost of a production or service process. For instance, if machine hours are cheaper, a firm may decide to shift towards more machine use and less labor, as seen in situations where a particular production technology with lower total costs is preferred.