Dictionary Home »
Invest » variable cost
variable cost investment & finance definition
A
cost that changes based on the level of sales or production. Examples of a
variable cost are temporary labor and materials that are used to produce goods.
Variable costs contrast with fixed costs, which don’t vary with production or
sales levels. For example, a manufacturing plant has fixed costs of rent,
depreciation, and insurance. These expenses will continue to be incurred even
if the plant closes for a two-week holiday.
See variable cost in Wall Street Words
Learn more about variable cost