Under what category does Hydro (Electricity) bill falls underGroup of answer choicesVariableFixed

Understanding the Nature of Hydro Electricity Bills

1. Definition of Variable Costs: Variable costs are expenses that change in proportion to the production output or usage level. In the context of an electricity bill, these costs fluctuate based on how much electricity is consumed.

2. Definition of Fixed Costs: Fixed costs remain constant regardless of the level of production or consumption. These bills do not vary with the amount of electricity used; instead, they may include basic service fees or monthly charges that are billed regardless of usage.

3. Assessment of Hydro Electricity Bills: Hydro electricity bills typically include both variable and fixed components. However, the bulk of the bill is usually reflective of the actual consumption of electricity, meaning it changes with the usage level.

Conclusion

Hydro electricity bills fall under the Variable category primarily due to the significant portion that directly correlates with usage. Although there may be a fixed charge, it is the fluctuating costs based on usage that make it primarily variable. Thus, the correct answer is Variable.