Fixed Cost

What Does Fixed Cost Mean?
A cost that remains constant, regardless of any change in a company's activity.

Investopedia explains Fixed Cost
A good example is a lease payment. If you are leasing a building at $2,000 per month, then you will pay that amount each month, no matter how well or how poorly the business is doing.

Related Terms

Absorption Costing
Chasing Nickels Around Dollar Bills
Operating Expense
Operating Leverage
Operating Margin
Outlay Cost
Relevant Cost
Semi-Variable Cost
Sunk Cost
Variable Cost
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