multiple choice 1. If the activity increases, one would expect the fixed cost to: a) remain unchanged on a per unit basis. b) decrease on a per unit basis. c) increase on a total basis. d) increase in a per unit basis. 2. The term used to identify the cost associated with production activity would be all of the following except for: a) product cost. b) inventoriable cost. c) period cost. d) manufacturing cost. 3. if the activity level drops by 5%, one would expect the fixed costs: a) to remain constant in total. b) to drop in total by 5%. c) to decrease per unit of production. d) to increase in total by 5%. 4. an indirect cost is also called a: a) fixed cost. b) direct cost. c) common cost. d) variable cost. 5. in making a decision on whether to purchase new equipment for use in the manufacturing process, which of the following would not be relevant: a) opportunity cost. b) sunk costs. c) any change in product costs. d) differential costs