CHAPTER 3

4. Unit labor cost = Total labor cost/Classes taught = $2,600/100 = $26. 5. New total classes = 100 + (0.50 × 100) = 150. Total labor cost = $600 + ($20 × 150) = $3,600. Unit labor cost = $3,600/150 = $24.00. The unit labor cost went down because the fixed cost, which stays the same, is spread over a greater number of classes taught ... ................
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