Auto-USA spent \($300\) million in total to produce 50,000 cars this year. The \($300\) million breaks down as follows: The company spent \($50\) million on fixed costs to run its manufacturing plants and \($5,000\) of variable costs to produce each car. Next year, it plans to produce 60,000 cars using the existing production facilities.

a. What is the current average product cost per car this year?

b. Assuming there is no change in fixed costs or variable costs per unit, what is the total forecasted cost to produce 60,000 cars next year?

c. What is the forecasted average product cost per car next year?

d. Why does the average product cost per car vary between years?