How the variable and fixed cost per unit will change as the level of activity (or cost driver) will increase? Why?

Total fixed costs do not change as production levels change within the relevant range; therefore, the level of production is not a factor in determining total fixed costs. Total variable costs, on the other hand, vary in direct proportion to change in the level of production; therefore, the level of production is a factor in determining total variable cost. Estimated total variable factory overhead equals the variable factory overhead cost per unit multiplied by the estimated level of production. Hence, the level of production for the next period must first be determined in order to estimate the total variable portion of factory overhead costs.