Average variable costs are constant at all output levels

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Reference no: EM13743840

UPS offers overnight package deliver to canadian business customers .UPS has recently decided to expand its facilities to better satisfy current and projected demand. current volume total 2 million packages per week at price of $ 12 each ,and average variable costs are constant at all output levels. Fixed costs are $3 million per week and profit contribution average one-third of on each delivery after competition of expansion project, fixed costs will double, but variable costs will decline by 25 percent.

Reference no: EM13743840

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