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What happens to the amount of variable cost per unit as the activity increases?

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Within the relevant range, the amount of variable cost per unit:

a. differs at each activity level
b. remains constant at each activity level
c. increases as activity increases
d. decreases as activity increases

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Solution Summary

This solution discusses the correct answer and the definition of the relevant range in 100 words.

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The correct answer is C - increases as activity is increased.

The variable cost function usually has an "U" shape: as the activity level increases, variable cost ...

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