What type of costs are considered fixed costs?

Fixed costs are expenses that do not change with the level of production or sales within a certain range. This means that even if production increases or decreases, fixed costs remain constant. Examples of fixed costs include rent, salaries of permanent staff, and insurance.

Understanding fixed costs is crucial for budgeting and financial forecasting, as they impact the overall operating expenses of a business. Since they must be paid irrespective of how much the business produces, they can influence decisions on pricing, profitability, and break-even analysis.

The other options describe characteristics of variable costs, which do fluctuate with activity levels, vary with production volume, or can be easily altered. This differentiation is key in cost management and strategic planning in a business setting.