Which statement best describes the relationship between per-unit fixed costs and output?
A) Per-unit fixed costs decrease as output increases.
B) Per-unit fixed costs increase as output increases.
C) Per-unit fixed costs decrease as output decreases.
D) Per-unit fixed costs stay the same as output changes.

Question

Quizplus · Accepted Answer

Per-unit fixed costs decrease as output increases because the total fixed costs are spread over a larger number of units, reducing the cost per unit.

Which Statement Best Describes the Relationship Between Per-Unit Fixed Costs