Understanding Fixed and Variable Costs EXAMLPE EXERCISES In each situation, determine what are the fixed costs and variable costs. Give your reasoning for each determination. 1. Marty wants to take care of meeting all the bills for a car. In caring for the ownership, payment, insurance, gas, and maintenance must be considered; also Marty wants to make sure the car gets washed twice a month. 2. A group of entrepreneurs is looking to setup a small manufacturing facility to create their product. They will have to rent space, and buy machines, materials, and packaging for shipping. They have also determined that a web-presence and telephone line will be necessary for their business. 3. Jack and Sally are looking to buy a house in Halloweentown. They have 20% to use as a down payment for housing in their desired range, and the bank is requiring them to escrow (pay monthly toward) their home owners insurance and property taxes. They are big TV watchers and dont do much streaming. The stove, dryer, and heating unit are natural gas