The Simple Multiplier Is

question 124

Multiple Choice

The simple multiplier is:

• A)1/MPC.
• B)1/(1 + MPC).
• C)1/MPS.
• D)1/(1 - MPS).

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent and salaries.

Direct Materials Price Variance

The difference between the actual cost and standard cost of direct materials used in production, indicating how effectively a company is purchasing its raw materials.

Data Collected

Information gathered through observation, experimentation, surveys, or other methods, which can be analyzed to gain insights or make decisions.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue contributes to covering fixed costs and generating profit.