If the Contribution Margin Is Not Sufficient to Cover Fixed

question 235

Multiple Choice

If the contribution margin is not sufficient to cover fixed expenses:

• A) total profit equals total expenses.
• B) contribution margin is negative.
• C) a loss occurs.
• D) variable expenses equal contribution margin.

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Definitions:

Direct Taxes

Taxes that are levied directly on the income or wealth of an individual or organization, such as income tax and property tax.

Per Capita Real GDP

This is a measure of the average economic output per person, adjusted for inflation, in a specific area.

GDP Deflator

A measure for evaluating the price index of all fresh, domestically produced, final goods and services in an economy.

Population

The total number of people inhabiting a particular territory or geographic area.