An Increase in the Price of Fertilizer Will Cause

question 8

Multiple Choice

An increase in the price of fertilizer will cause:

• A) the supply of fertilizer to increase
• B) the quantity supplied of fertilizer to increase
• C) a shift in the supply of fertilizer
• D) a movement along the supply curve of wheat

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Definitions:

Monthly Fixed Expense

Expenses that do not vary with production volume or business activity level, incurred on a monthly basis.

CM Ratio

Contribution margin ratio, showing the portion of sales revenue that is not consumed by variable costs and contributes to covering fixed costs.

Fixed Expenses

Costs that do not fluctuate with the level of production or sales, such as rent, salaries, and insurance premiums.

Units

A measure of quantity for items that are being produced, sold, or inventoried by a company.