The Contribution Margin Ratio Increases When

question 127

Multiple Choice

The contribution margin ratio increases when

• A) fixed costs increase.
• B) fixed costs decrease.
• C) variable costs as a percentage of sales decrease.
• D) variable costs as a percentage of sales increase.

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Definitions:

Buying Decisions

The process by which a consumer identifies a need, gathers information, evaluates choices, and makes a purchase.

Organizational Culture

Reflects the set of values, traditions, and customs that guide a firm’s employees’ behavior.

Geography

The study of places, the relationships between people and their environments, and how physical and human processes interact on Earth.

Autocratic Buying Center

A buying center in which one person makes the decision alone, though there may be multiple participants.