An organization incurs costs under the following heads:

1. Insurance

2. Labour

3. Depreciation

Which among the above is / are fixed costs?

Answer: [C] Only 1 & 3

Insurance is a fixed Cost. Labour comes under Variable cost and most importantly, Depreciation also comes under Fixed Costs. This is because, depreciation of plant and equipment occurs despite of low activity or inactivity.

This question is a part of GKToday's Integrated IAS General Studies Module