____ are also known as direct costs A. average variable costs B. average fixed costs C. variable costs D. total fixed costs

Breakdown the Problem

1. Identify what is meant by "direct costs."
2. Analyze the given options to find which one aligns with the definition of direct costs.

Relevant Concepts

• Direct costs are expenses that can be directly attributed to a specific product, service, or project.
• Variable costs are a type of direct cost that change with the level of output.

Analysis and Detail

1. Option A: Average variable costs - This refers to variable costs divided by the quantity produced, but not all variable costs are direct costs.
2. Option B: Average fixed costs - These are not direct costs as they do not vary with production level.
3. Option C: Variable costs - These are costs that fluctuate with production levels and can be directly attributed to specific products. Thus, they are classified as direct costs.
4. Option D: Total fixed costs - These do not vary with production and are therefore not direct costs.

Verify and Summarize

Upon review, "variable costs" directly correlate with direct costs because they are precisely tied to the production levels of goods or services.

Final Answer

C. variable costs