If There Is an Inverse Relationship Between Two Variables, the Graph

question 12

Multiple Choice

If there is an inverse relationship between two variables, the graph relating the two variables will be:

• A) upward-sloping.
• B) downward-sloping.
• C) vertical.
• D) horizontal.

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Definitions:

Variable Expenses

Expenses that fluctuate with the level of output or activity, in contrast to fixed expenses that remain constant regardless of activity level.

Net Operating Income

The earnings a business retains after subtracting operational costs, prior to the deduction of interest and taxes.

Total Contribution Margin

The difference between a company's sales revenue and variable costs, representing the amount available to cover fixed costs and contribute to profit.

Net Operating Income

A measure of a company's profitability excluding interest and tax expenses.