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Fixed Cost
(redirected from fixed costs)

    Also found in: Dictionary/thesaurus, Medical, Encyclopedia, Wikipedia, Hutchinson 0.01 sec.
Fixed cost
A cost that is fixed in total for a given period of time and for given production levels.
fixed cost
A cost that remains unchanged even with variations in output. An airline with 20 airplanes has the fixed costs of depreciation and interest (if the planes are partially financed with debt), regardless of the number of times the planes fly or the number of seats filled on each flight. Firms with high fixed costs tend to engage in price wars and cutthroat competition because extra revenues incur little extra expense. These firms tend to experience wide swings in profits. Compare variable cost.
Fixed Cost
An expense that does not change from time period to time period. For example, a company may rent a piece of property for $4,000 per month. A company often prefers to have fixed costs because they reduce uncertainty, but this is not always possible.


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A quick guide for analysis of loss-cost metrics recognizes that, on average, fixed costs represent just 20% to 25% of total program costs.
Managing loss-cost differences: to attract and retain larger and more ... by Malugen, William / Best's Review
Fixed costs are those that were present even before we opened the door to the first patient or even if no patients were ever seen.
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The closure of the plant, which employs 340 workers, is expected to reduce fixed costs in 2006 by $25 million.
Wescast closing Brantford plant, renames Hungarian operation by Modern Casting
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