All Other Things the Same, Which of the Following Would $\begin{array}{cc} & \text { Contribution Margin } & \text { Variable Costs } \\\end{array}$

question 89

Multiple Choice

All other things the same, which of the following would be true of the contribution margin and variable costs of a company with high fixed costs and low variable costs as compared to a company with low fixed costs and high variable costs?
$\begin{array}{cc} & \text { Contribution Margin } & \text { Variable Costs } \\\end{array}$
A. $\begin{array}{cc}&&& \text { Higher } &&&&&& \text { Higher } \\\end{array}$
B. $\begin{array}{cc}&&& \text { Lower } &&&&&& \text { Higher } \\\end{array}$
C. $\begin{array}{cc} &&&\text { Higher }&&&&&& \text { Lower } \\\end{array}$
D. $\begin{array}{cc} &&& \text { Lower } &&&&&& \text { Lower } \\\end{array}$

• A) Option A
• B) Option B
• C) Option C
• D) Option D

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Definitions:

Divides Labour

Separating a work process into distinct tasks that are performed by different workers or groups to enhance productivity and efficiency.

Mechanistic Organization

Describes a highly structured and hierarchical type of organization that operates under rigid procedures and clear chains of command.

Organic

Refers to processes, structures, or products developed naturally without artificial enhancements or chemicals.

Working to Rule

A form of industrial action where employees strictly follow the rules and guidelines to the letter as a means of protest, often reducing productivity.