Why do costs vary with quantity?
One variable of costing is set-up time. This variable represents the time required to set up a machine to fabricate a plastic part. As this is a fixed cost (does not vary with quantity of parts), its effect on the per-piece price varies with the quantity. For example, a one piece lot price is virtually entirely set up with little run time. Conversely 10,000 piece pricing is all run-time costing with negligible setup.
