Which of the Following Is True About the Assumptions Underlying

question 87

Multiple Choice

Which of the following is true about the assumptions underlying basic CVP analysis?

• A)Only selling price is known and constant.
• B)Only selling price and variable cost per unit are known and constant.
• C)Selling price,variable cost per unit,fixed cost per unit,and total fixed costs are known and constant.
• D)Only selling price,variable cost per unit,and total fixed costs are known and constant.

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Definitions:

Total Revenue

The total income generated by a business from the sale of goods or services before any expenses are subtracted.

Sales Quantity

Sales quantity is the total amount of units of a product or service sold during a specific period.

Marginal Revenue

The additional income earned by selling one more unit of a good or service; it can vary depending on the current level of output and market conditions.

Fourth Unit

Typically implies an incremental or additional unit in a sequence, often used in economics or logistics to discuss marginal utilities or effects.