Which of the Following Would Produce the Largest Increase in the Contribution

question 54

Multiple Choice

Which of the following would produce the largest increase in the contribution margin per unit?

• A) A 7% increase in selling price.
• B) A 15% decrease in selling price.
• C) A 14% increase in variable cost.
• D) A 17% decrease in fixed cost.
• E) A 23% increase in the number of units sold.

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Definitions:

Units

Measurements or quantities of a product, item, or component, often used as a basis for production, inventory, or sales.

Waiting-Line Problem

A scenario in operational research where the focus is on reducing waiting times and improving service efficiency in queueing systems.

Operations

Activities involved in the day-to-day running of a business for producing and delivering products or services.

Average Time

The mean time taken to complete a task or process, calculated by summing all the recorded times and dividing by the number of observations.