When analyzing costs, two rules of thumb are useful: 1) think of fixed costs on a per-unit basis; and 2) think of variable costs as a total.

Question

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Fixed costs should be thought of in total because they do not change with the level of output, while variable costs should be considered on a per-unit basis since they change with the level of production or sales volume.

When Analyzing Costs, Two Rules of Thumb Are Useful: 1)