The per-unit cost of an item is its average total cost (= total cost/quantity). Suppose that a new cell phone application costs $200,000 to develop and only $0.5 per unit to deliver to each cell phone customer.
What will be the per-unit cost of the application if it sells 100 units?
What will be the per-unit cost of the application if it sells 1000 units?
What will be the per-unit cost of the application if it sells 1 million units?