Explore BrainMass

Cost Concepts: Balance of Fixed and Variable Costs

This content was STOLEN from BrainMass.com - View the original, and get the already-completed solution here!

Choose an organization that has a high fixed cost and low variable cost balance to run its operations. Discuss the balance of fixed and variable costs for the organization. How can the organization use technology to change this balance for an advantage?

© BrainMass Inc. brainmass.com October 25, 2018, 6:33 am ad1c9bdddf

Solution Preview

An example of such organization will be software companies like Microsoft, Adobe or Mcafee that have high fixed costs but lower variable costs as most of the software companies have to spend on fixed costs like salary of employees for R&D, customer support and development related functions. Once fixed costs are ...

Solution Summary

This solution identifies software companies as having high fixed costs and low variable costs. This solution is 191 words.

See Also This Related BrainMass Solution

Apply economic cost concepts in making business decisions

Businesses often decide between using automation and labor in production. An automotive environment may have high fixed costs and low variable costs, and an industry that utilizes manual labor for production will have low fixed costs and high variable costs. How would you describe the balance between the costs of automation, or fixed costs, and the costs of labor, or variable costs? How has technology changed the balance between automation and labor? What type of industry benefits the most from technological innovation?

View Full Posting Details