How do fixed costs per unit behave?
A)They remain the same throughout production levels within the relevant range.
B)They decrease as production decreases.
C)They increase as production decreases.
D)They increase as production increases.

Question

Quizplus · Accepted Answer

Fixed costs per unit increase as production decreases because the total fixed costs are spread over a smaller number of units, making the cost per unit higher.

How Do Fixed Costs Per Unit Behave