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A company received a special order for 100 units when they were already producing 1,000. The company has sufficient capacity remaining to produce the 100

A company received a special order for 100 units when they were already producing 1,000. The company has sufficient capacity remaining to produce the 100 additional units. The average cost per unit at 1,000 units is $1 per unit. However, fixed costs of the company are $250. If the company used the average cost of $1 to predict the cost of the 100 units, what mistake will they make?

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The predicted cost will be $75 too high

The predicted cost will be $25 too high

The predicted cost will be $75 too low.

The predicted cost will be $25 too low

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