Classify costs incurred by AT&T Inc. as fixed, variable, or mixed, based on their behavior in relation to changes in activity levels. Provide examples of each type of cost and explain how AT&T's cost structure affects its financial performance. Discuss strategies for managing fixed and variable costs to improve profitability and cost efficiency.
Values:
•Total Fixed Costs: $1,000,000
•Variable Cost per Unit: $10
•Activity Level: 100,000 units