business costs

Start up costs - barriers of entry, legal permits, staff employment, manufacturing machinery, premises, etc.

Running costs are different to start up costs, as start up costs are a one off payment when opening a business, where as running costs are the recurring costs throughout a businesses lifetime, such as, electric bills, heating bills, staff wages, fuel costs.

Direct costs = direct materials e.g. engine parts,  direct labour e.g. wages paid to employees on the production line

Indirect costs = Indirect labour costs, e.g. management salaries and wages paid to security staff,  administration and distribution

Oppurtunity costs = values a product in what has been given up to obtain it.

total costs = fixed costs + variable costs

fixed costs will not vary when a business alters its levels of output e.g. rent

variable costs alter directly with the level of a firms output e.g. expenditure on fuel

semi variable costs have fixed and variable elements e.g. telephone costs