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Question 18 2.5 pts At current production volume of 1,000 units, variable costs are $2 per unit and fixed costs are $3 per unit, for a total unit cost of $5 per unit. Predict total costs at production volume of 900 units. O $4,500 O $4,800 not enough information -- need to know the total cost equation O $1,800 0 $4,700

Answer 1

At 1000 units

Variable cost=1,000*$2=$2,000

Fixed cost=1,000*$3=$3,000
At 900 units

Variable cost=900*$2=$1,800

Fixed cost=$3,000(As fixed cost remains fixed for all production volume)

Total cost=Variable cost+Fixed cost

Total cost=$3,000+$1,800

Total cost=$4,800

Thus,total cost at 900 units=$4,800.