The fixed cost per unit:
A) will increase as activity increases.
B) will increase as activity decreases.
C) will decrease as activity increases.
D) will remain constant.
E) will increase as activity decreases and will decrease as activity increases.

Question

Quizplus · Accepted Answer

Fixed cost per unit decreases as activity increases because the total fixed cost is spread over more units, and it increases as activity decreases because the total fixed cost is spread over fewer units.

The Fixed Cost Per Unit