If the Sales Price Per Unit Increases While the Variable

question 63

Multiple Choice

If the sales price per unit increases while the variable cost per unit and total fixed costs remain constant, which of the following statements is true?

• A)The contribution margin decreases and the breakeven point decreases.
• B)The contribution margin increases and the breakeven point decreases.
• C)The contribution margin increases and the breakeven point increases.
• D)The contribution margin decreases and the breakeven point increases.

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Definitions:

Corporate Governance

The system by which companies are directed and controlled, involving the mechanisms, processes, and relations by which corporations are regulated and operated.

Management Fixated

Refers to an organizational focus predominately on management perspectives, often at the expense of considering employee viewpoints or other stakeholder interests.

Structural Power

The ability of a group or institution to shape societal structures, norms, and policies through its control over economic resources, political influence, or social relationships.

Bargaining Power

The capacity of one party, such as a labor union or an employer, to influence the terms of an agreement during negotiations.