The cost of feed represents a fixed costs.

• A. False
• B. True
• C. Not Applicable
• D. Unknown

Answer: (A)

Costs in production are categorized by how they behave as output changes. Feed is a variable cost because it moves with how much you feed and how many fish you’re growing—the more your fish grow or the more you stock, the more feed you need, and the expense rises accordingly. If you cut feeding or slow growth, the feed bill drops. In contrast, fixed costs stay the same regardless of production levels, like facility rent, certain salaries, or equipment depreciation. So describing feed as a fixed cost doesn’t fit how feed use responds to production. (There can be contracts or pricing arrangements that stabilize price, but the typical behavior of feed expense is to vary with production.)