For liability insurance, Dizzy pays a set monthly fee plus a small additional amount for every patron entering the park.The cost of liability insurance would best be described as a:

A) fixed cost
B) mixed cost
C) step-variable cost
D) true variable cost

Mixed Cost

A cost that contains both variable and fixed cost elements, making its total expense vary with changes in the level of output.

Fixed Cost

Expenses that do not fluctuate with changes in production volume, staying constant even as production levels vary.

Liability Insurance

A type of insurance that protects an individual or business from the risk of being sued and held legally liable for something such as malpractice, injury, or negligence.