The Contribution Margin Per Unit Equals

question 31

Multiple Choice

The contribution margin per unit equals .

• A) fixed cost - contribution margin ratio
• B) selling price - fixed costs per unit
• C) selling price - variable costs per unit
• D) selling price - costs of goods sold

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Definitions:

Delta

The number of stocks required to hedge against the price risk of writing one option. Also called the hedge ratio.

Underlying Asset

An asset upon which a derivative's price is based, ranging from commodities and currencies to stocks and bonds.

Call Price

The price at which a callable bond can be redeemed by the issuer before its maturity date, typically higher than the face value.

Option Value

The inherent value of an option contract, determined by factors like the underlying asset's price, the strike price, and the time until expiration.