Types of costs Definitions

Question 1

Fixed cost

Answer 1

costs that stay the same no matter how much activity a business is doing

Question 2

Variable cost

Answer 2

expensses that a business incurs that change with the amount of goods produced or services provided

Question 3

Loan shark

Answer 3

a moneylender who charges extremely high interest rates, typically under illegal conditions

Question 4

Patient capital

Answer 4

a long-term financing where investors are willing to wait longer(i.e. at least a few years) to see financial returns and expecct a fair return on their investment

Question 5

For-profit commercial enterprise

Answer 5

a type of business that earns profits, which are distributed to owners or shareholders(profits may have priority over other objectives)

Question 6

Piece-rate wages

Answer 6

wages that vary depending on the amount the employee produces

Question 7

Revenue stream

Answer 7

income that a business generates for a particular activity(i.e. a specific way that a business generates income)