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An organization has the following total costs at two activity levels:
Activity level (units) 8,000 13,000
Total costs (£) 22,000 31,000
Fixed costs are constant in this range of activity and variable cost per unit
decreases by £1.5 per unit when activity exceeds 12,000 units.
Required:
What is the total cost at an activity level of 16,000 units?
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