In economics, fixed costs are
business expenses that are not dependent on the
level of goods or services produced by the
business. They tend to be time-related, such as
salaries or rents being paid per month, and are
often referred to as overhead costs. For some
employees, salary is paid on monthly rates,
independent of how many hours the employees
work. This is a fixed cost. On the other hand, the
hours of hourly employees paid in wages, can
often be varied, so this type of labour cost is a
variable cost.