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A. Variable costs per unit fluctuate and fixed costs
per unit remain constant.
B. Variable costs per unit are fixed over the
relevant range and fixed costs per unit are
variable.
C. Total variable costs are variable over the
relevant range and fixed in the long term, while
fixed costs never change.
D. Variable costs per unit change in varying
increments, while fixed costs per unit change
in equal increments.
B : Variable costs per unit are fixed over the relevant range, and fixed costs per unit are variable.
fixed costs are fixed in total over the relevant range, that's why the more units produced the less a unit has to bare of these fixed costs, meaning fixed cost PER UNIT decreases when production level increases.
While variable costs IN TOTAL increases if production level is increased, and decreases if production level is decreased, they are called variable because they change with production level, this change is fixed per unit.
B. Variable costs per unit are fixed over the
relevant range and fixed costs per unit are
variable.
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