Answer (A) is correct . The relevant range defines the limits within which per-unit variable costs remain constant and fixed costs are not changeable. It is synonymous with the short run. The relevant range is established by the efficiency of a company’s current manufacturing plant, its agreements with labor unions and suppliers, etc.
Answer (B) is incorrect because The relevant range refers to the activity levels over which cost relationships hold constant.
Answer (C) is incorrect because Production varies over both the relevant range (the short run) and the long run.
Answer (D) is incorrect because Relevant costs are those pertaining to a particular decision.
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