Contribution Margin

question 44

Multiple Choice

Contribution margin

• A) is not the same as marginal income.
• B) can be calculated as a ratio or per unit.
• C) equals the sales price minus all the fixed expenses.
• D) equals total fixed costs minus total variable costs.

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Definitions:

Initial Public Offering

The first time a company offers shares of stock to the public in order to raise capital.

First Stock Issue

The initial offering of a company's stock to the public, also known as an Initial Public Offering (IPO).

Insider Trading

The illegal practice of trading on the stock exchange to one's own advantage through having access to confidential information.

Executives

Senior-level employees responsible for strategizing, decision-making, and overseeing a company or organization's overall direction.