Commercial Pilot Licence (CPAER) – Canada · Question
In a manufacturing company, what impact would an increase in the number of units produced have on the per-unit fixed cost, assuming all other factors remain constant?
Fixed costs remain constant in total regardless of the level of activity. Therefore, as the number of units produced increases, the total fixed cost is spread o
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Question: In a manufacturing company, what impact would an increase in the number of units produced have on the per-unit fixed cost, assuming all other factors remain constant?
Answer options:
- The per-unit fixed cost would increase. ✅ The per-unit fixed cost would decrease.
- The total fixed cost would decrease.
- The per-unit fixed cost would remain unchanged.
Correct answer: The per-unit fixed cost would decrease.
Explanation: Fixed costs remain constant in total regardless of the level of activity. Therefore, as the number of units produced increases, the total fixed cost is spread over more units, causing the per-unit fixed cost to decrease.
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Question explanations
- What is the minimum visibility required for a commercial VFR flight in Class D airspace at or below 3,000 feet
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- Scenario 1: A commercial pilot conducting an IFR flight in Canadian airspace must hold which of the following
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