The table below shows the output, total costs and the cost inflation index for a business in two periods. Cost behaviour patterns were the same in both periods.

The variable cost per unit at an inflation index of 1.08 will be:

(a) $1.56

(b) $1.45

(c) $1.50

(d) $1.62 (2 marks)
CIMA P1 Performance Operations

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Output level Total cost Inflation index 12 000 units $21.000 1.05 16 000 units $26 780 1.03