The cost is determined by the tolerance .001 inch, which is reasonable for this class of work, and not by the resulting minimum clearance of .0005 inch which is in a sense, incidental only, since it depends on the fixture and the selected part, not on the fixture as such. The resulting maximum clearance is within the maximum permissible value of .004 and also allow an ample margin.
As a part of minimum diameter is shifted through the maximum clearance of .0025 inch, the center of the part is shifted between positions .00125 inch