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400 words. 

Understanding cost behavior is important for analysis and decision making. Cost can be broadly categorized as fixed, variable, or mixed. The way costs behave in relation to production drives pricing and cost estimation.

  • Evaluate the behavior of fixed, variable, and mixed costs in a manufacturing environment.
  • Elaborate on an example of each type of cost as applied in a manufacturing environment.
  • Communicate why understanding the costs you have chosen are essential in pricing and cost estimation.
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