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Examples of start-up costs are as follows
(i) Acquiring land to set-up a business.
(ii) Constructing building to start business.
(iii) Purchasing computers.
(iv) Investing money in purchasing equipments, etc.
Operational Costs: Operational costs are incurred tor carrying out the day-to-
day operations of the business.
They are further classified as
(i) Fixed costs: These costs are not dependent upon the level of output. These costs an
entrepreneur has to incur for starting a business and
also as various administrative expenses.
(ii) Variable costs: These costs are those which vary with the total cost of the organization
when output varies. These are related with the
production of the product.
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