Multiple Products Make Using Financial Models More Complex

question 47

Multiple Choice

Multiple products make using financial models more complex.To deal with this,managers can do which of the following?

• A)assume that all products have the same contribution margin.
• B)use contribution margin as a measure of volume.
• C)assume a weighted-average sales volume.
• D)All of the answers are correct.

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Definitions:

Duty of Loyalty

An obligation to act in the best interest of another party, typically in fiduciary relationships.

Corporate Opportunity

A legal doctrine that prohibits directors, officers, and controlling shareholders of a corporation from taking a business opportunity for themselves that rightfully belongs to the corporation.

Canada Business Corporations Act

A Canadian federal statute that governs the incorporation, governance, and dissolution of companies in Canada.

Derivative Action

An action taken by a shareholder in a corporation's name to enforce the corporation's rights when the corporation fails to do so itself.