Answer:
b. changes in the same direction and in direct proportion to changes in operating activity.
Step-by-step explanation:
Variable costs rise whenever production increases and falls whenever it decreases. This relationship shows that variable cost is a direct function of production volume. Examples are labor, packaging, raw materials, as these are utilized in a company's manufacturing process.
They are different from fixed costs as the latter remain the same irrespective of the volume of production your business generates. Fixed costs are also predetermined ,hence remain the same throughout a specific period.