When 40,000 units are produced,fixed costs are $16 per unit.Therefore,when 80,000 units are produced,fixed costs will:
A)increase to $32 per unit.
B)remain at $16 per unit.
C)decrease to $8 per unit.
D)total $640,000.
E)total $540,000.

Question

Quizplus · Accepted Answer

Fixed costs per unit decrease as production increases because total fixed costs are spread over more units.

When 40,000 Units Are Produced,fixed Costs Are $16 Per Unit