(Answered) Why variable costs might be considered less risky than fixed costs?Why variable costs might be…

➤ When should a business prefer variable costs over fixed costs?
Choose variable cost structures when demand is uncertain, sales are seasonal, or capital is limited. Startups and project-based firms often favor pay-as-you-go models like outsourcing, contractors, or revenue-sharing. These options keep fixed commitments low and enable rapid scaling up or down with market changes.