There Is an Important Relationship Between Contribution Margin and Profit

question 118

Multiple Choice

There is an important relationship between contribution margin and profit.Which of the following statements is not true?

• A)As the number of units sold increases, total contribution margin increases, but fixed costs remain the same.
• B)As the number of units sold rises, profit increases by the additional contribution margin per unit.
• C)As the number of units sold increases, total contribution margin and fixed costs increase.
• D)As the number of units sold decreases, total contribution margin decreases, but fixed costs remain the same.

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Definitions:

Load Capacity

The maximum load weight or force that a structure, machine part, or material can safely support without failure.

Roller Bearings

Bearings that use cylindrical rollers as rolling elements, offering reduced friction between rotating components.

Tapered Roller Bearings

Bearings that can support significant axial and radial loads; they use conical rollers guided by a back-face rib on the cone.

Radial

Pertaining to directions or movements that extend outward from a central point or axis, commonly used in describing mechanical parts or forces.