A Firm Is Experiencing an Increase in Variable Costs

question 35

Multiple Choice

A firm is experiencing an increase in variable costs. What can the firm do to maintain its profitability?

• A) Increase its fixed costs to balance out its increased variable costs.
• B) Decrease its fixed costs to break even sooner.
• C) Raise its price to increase its contribution margin.
• D) Lower its price to gain a greater market share.

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Definitions:

Schizophrenia

A chronic psychiatric disorder characterized by distorted thoughts, perceptions, emotions, language, sense of self, and behavior.

Dopamine Hypothesis

A theory suggesting that the symptoms of schizophrenia are due to an excess of dopamine activity in the brain.

Dopamine Activity

The action or influence of dopamine, a neurotransmitter involved in reward, motivation, and motor control in the brain.

Psychosis

A mental health condition characterized by disconnection from reality, which may include delusions and hallucinations.