Say a companys total costs are $2,500,000 when 100,000 units are made. Of the total cost,

$400,000 is fixed. Assume all volumes referenced in the question fall within the relevant range.

What are the expected total costs when 140,000 units are made?

A.

$2,500,000

B.

3,340,000

C.

3,500,000

D.

3,900,000

E.

2,940,000

-If volume increases, what happens to the variable cost per unit?

A.

The variable cost per unit increases.

B.

The variable cost per unit does not change.

C.

The variable cost per unit decreases.

-If volume decreases, what happens to the total variable costs?

A.

Total variable costs increase.

B.

Total variable costs decrease.

C.

Total variable costs do not change.

-If volume increases, what happens to the fixed cost per unit?

A.

The fixed cost per unit does not change.

B.

The fixed cost per unit decreases.

C.

The fixed cost per unit increases.

-If volume decreases, what happens to the total fixed costs?

A.

Total fixed costs decrease.

B.

Total fixed costs do not change.

C.

Total fixed costs increase.