Question
Assume that a company has employed the high low method and estimated its cost function. The estimated cost function is Y = 3,000 + 5
Assume that a company has employed the high low method and estimated its cost function. The estimated cost function is Y = 3,000 + 5 X (X = number of units produced, Y = total cost). Which of he following is not true?
A. | If the company makes 900 units of the product, its estimated total variable cost will be $5. | |
B. | If the company makes 1,000 units of the product, its estimated total cost will be $8,000. | |
C. | If the company makes more unts of the product, its estimated total cost will be higher. | |
D. | If the company makes 600 units of the product, its estimated total fixed cost will be $3,000. |
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