what does fixed costs mean
DEFINITION of 'Fixed Cost'. A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses that have to be paid by a company, independent of any business activity.It is one of the two components of the total cost of a good or service, along with variable cost.Next Up.n example of a fixed cost would be a company's lease on a building. If a company has to pay $10,000 each month to cover the cost of the lease but does not manufacture anything during the month, the lease payment is still due in full.