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

question 69

Multiple Choice

Assume that only the specified parameters (that is, variables) change in a sensitivity analysis. The contribution margin ratio increases when:

• A) Total short-term fixed costs increase.
• B) Total short-term fixed costs decrease.
• C) The variable cost per unit increases.
• D) The variable cost per unit decreases.
• E) Sales volume increases.

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Definitions:

Ethical Intensity

Refers to the degree of importance or significance given to an ethical issue, determined by its potential impact on stakeholders and the urgency of addressing it.

Factors Influencing

Elements or conditions that affect the outcome of a process or the behavior of individuals.

Behaviors

Observable actions or reactions of individuals or groups in response to external or internal stimuli.

Stakeholder Responsibility

The obligation of an organization to consider the interests and wellbeing of all its stakeholders in its decisions and actions.