If a Product Line Has a Negative Contribution Margin, the Product

question 152

True/False

If a product line has a negative contribution margin, the product is not covering its fixed costs and should be discontinued.

---

Definitions:

Political Environments

Refers to the political factors, including laws, government agencies, and pressure groups that influence or limit various organizations and individuals in a society.

Intellectual Assets

Intangible resources of a company, including patents, trademarks, business models, and the expertise of employees, that contribute to its competitive advantage.

Knowledge

Information, understanding, or skill that one gains through education or experience.

Informal Systems

Unofficial ways of operating within an organization that arise from personal interactions, cultures, and norms outside formal structures.