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gam co (6/14)
For part a) of this question, should variable costs of 12 be used for volumes up to 100000 units and variable costs of 11 be used for volumes over 100000 or is it that only one of the variable costs figure be used whether it is above 100000 or below 100000
The question says that the cost would fall to $11 for all the units produced. So if they produce less than 100,000 then all the units cost $12. If they produce more than 100,000 then all the units cost $11.