If a Company Increases Its Sales Price by $5 and Its

question 137

Multiple Choice

If a company increases its sales price by $5 and its variable costs per unit also increase $5, then

• A)total contribution margin will decrease.
• B)the contribution margin per unit will decrease.
• C)the contribution margin per unit will increase.
• D)the contribution margin per unit will not change

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Definitions:

Pyloric Sphincter

Thickening of the circular layer of the gastric musculature encircling the junction between the stomach and duodenum; also called pylorus.

Hydrochloric Acid

A strong acid secreted by the stomach lining that helps in digestion by breaking down food and killing bacteria.

Submucosal Layer

The layer of tissue lying just beneath the mucosa, containing blood vessels, nerves, and glands, found in various tubular structures in the body.

Mucus

A sticky, slimy substance produced by mucous membranes and glands for protection and lubrication in the body, such as in the respiratory and digestive tracts.