Assume Only the Specified Parameters (That Is, Variables) Change in a Sensitivity

question 57

Multiple Choice

Assume only the specified parameters (that is, variables) change in a sensitivity analysis. If the contribution margin increases by $2 per unit, then operating profits will:

• A) Also increase by $2 per unit.
• B) Increase by less than $2 per unit.
• C) Decrease by $2 per unit.
• D) Increase, but by an indeterminate amount.
• E) Decrease, but by an indeterminate amount.