In a factory, the fixed costs per unit are $45 when 400 units are produced. If 450 units are produced, the fixed costs per unit would be

Question

Quizplus · Accepted Answer

The formula for calculating fixed costs per unit is:
Fixed costs per unit = Total fixed costs / Number of units produced

Using the information given in the question, we can calculate the total fixed costs:
Total fixed costs = Fixed costs per unit x Number of units produced

When 400 units are produced:
Total fixed costs = $45 x 400 = $18,000

To calculate the fixed costs per unit when 450 units are produced, we can use the same formula:
Fixed costs per unit = Total fixed costs / Number of units produced
Fixed costs per unit = $18,000 / 450 = $40.00

Therefore, the answer is B, $40.00.

In a Factory, the Fixed Costs Per Unit Are $45