The Contribution Margin Ratio

question 7

Multiple Choice

The contribution margin ratio:

• A)Is the percent of each sales dollar that remains after deducting the total unit variable cost.
• B)Is the percent of each sales dollar that remains after deducting the total unit fixed cost.
• C)Is the percent of each sales dollar that remains to cover the variable and fixed costs.
• D)Cannot be used in conjunction with other analytical tools.
• E)Is the same as the unit contribution margin.

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Definitions:

Financial Account

A component of the balance of payments that records investment flows and holdings of foreign assets by domestic residents and domestic assets by foreigners.

Official Reserves

Foreign currencies owned by the central bank of a nation.

Balance Of Payments

A document detailing every financial transaction between a country's inhabitants and international entities within a specific timeframe.

Central Banks

Primary financial institutions responsible for the oversight and management of a country's currency, money supply, and interest rates, aiming to stabilize the economy.