Damon Company leases its productive facilities at a cost of $10,000 per month. Total fixed costs of the facilities will remain constant at every level of activity. But, on a per unit basis, the cost of rent will decline as activity increases, as part (b).At 2,000 units, the unit cost is $5 ($10,000 / 2,000). When Damon produces 10,000 radios, the unit cost is only $1 ($10,000 / 10,000).