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What is given in the Study Hub:
Mixed Cost decreases for Cost per Unit.
Mixed cost increases for total cost.I don’t understand the logic behind these two statement. Could you help please?
The variable cost stays the same per unit. However the fixed cost decreases per unit if more are produced (the same total fixed cost is absorbed over more units. So the total (mixed) cost decreases.
With more units, the total fixed costs stays the same but the total variable cost increases. So the total (mixed) cost increases with more units produced.
Have you watched my free lectures on this?
Thank you. I have understood.
I have watched the lecture but had some confusion with this question. It’s clear now.
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