Samuelson and Marks, Question #10, p. 220.

Samuelson and Marks, Question #10, p. 220.

Analysis

It is a general rule that if number of production hours is increased it will also increase the variable cost of an organization. There are different aspects once the variable cost is increased. One is that there will be no change in the per unit cost of the organization. The second scenario is where the change in the production hours will result in increase of per unit cost. Usually when there is an increase in the production hours there is a change in per unit cost. This is because ...