In January 2004,the Price of Coffee Was $0

question 8

Multiple Choice

In January 2004,the price of coffee was $0.74 per pound. By January 2011,the price of coffee had increased to $2.63. The simple index is about ________.

• A)0.48
• B)0.28
• C)355
• D)189

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Definitions:

Relevant Range

The range of activity within which the assumptions about fixed and variable cost behaviors are valid.

Sunk Cost

A past cost that has already been incurred and cannot be recovered, which should not influence future financial or business decisions.

Net Operating Income

The profit generated from a company's ordinary, day-to-day business operations, calculated by subtracting operating expenses from gross profit.

Contribution Approach

A method of income statement presentation where variable costs are deducted from sales to find the contribution margin.