If total costs are $80,000 at an output of 12,000 units and $95,000 at 15,000 units, fixed costs are:

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Fixed costs remain constant regardless of the level of production. To find the fixed costs, we first calculate the variable cost per unit at each level of production. The increase in total costs ($95,000 - $80,000 = $15,000) divided by the increase in units produced (15,000 - 12,000 = 3,000 units) gives a variable cost of $5 per unit. Then, using either level of production to calculate fixed costs: at 12,000 units, total costs are $80,000, out of which $60,000 ($5 * 12,000) are variable, leaving $20,000 as fixed costs.

If Total Costs Are $80,000 at an Output of 12,000