Which type of cost changes directly with the number of patients?

The correct answer is variable cost because this type of cost is directly associated with the level of activity or volume of operations, which in this context refers to the number of patients. Variable costs fluctuate as the number of patients increases or decreases. For instance, in a healthcare setting, costs related to supplies, medications, and certain staffing may increase as more patients are treated, as these resources are utilized more intensely.

Fixed costs, in contrast, remain constant regardless of patient volume, such as rent for the facility or salaries of administrative staff. Indirect costs do not directly tie to patient volume and can involve elements like general administrative expenses that serve broader organizational functions. Overhead costs are similar to indirect costs and include expenses necessary to run the organization but not linked directly to patient care.