A By-Product Can Become a Main Product When

question 58

Multiple Choice

A by-product can become a main product when:

• A) Changes in technologies give it greater sales value
• B) Markets contract, lessening demand
• C) Its net costs increase
• D) Its value decreases

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Definitions:

Contribution Margin

The amount by which the sale of a product exceeds its variable costs, contributing to covering fixed costs and generating profit.

Commercial Segment

A portion of a market composed of businesses and organizations, as opposed to individual consumers.

Wholesale Division

A segment of a company that deals with selling goods in large quantities at lower prices, typically to retailers or other businesses rather than direct to consumers.

Contribution Margin

The difference between a company's sales revenue and variable expenses, indicating how much revenue contributes to covering its fixed costs and generating profit.