A 10% increase in production volume will result in a

Question

A. 10% increase in the variable cost per unit

B. 10% increase in total administration costs

C. 10% increase in total mixed costs

D. 10% increase in total variable costs

Answer 1

A 10% increase in production will result in a 10% increase in total variable costs.  By definition, variable costs change in direct proportion to the change in production.