Meaning of the word "fixed costs" in English

What does "fixed costs" mean in English? Explore the meaning, pronunciation, and specific usage of this word with Lingoland.

fixed costs

US /ˈfɪkst kɔsts/
UK /ˈfɪkst kɒsts/

Plural Noun

business expenses that are not dependent on the level of goods or services produced, such as rent, insurance, and salaries

Example:
Rent and salaries are examples of fixed costs that a business must pay regardless of production.
Reducing fixed costs can significantly improve a company's profitability.