Which of the Following Occurs If a Company Experiences a Decrease

question 65

Multiple Choice

Which of the following occurs if a company experiences a decrease in its fixed costs?

• A) Income would decrease.
• B) The break-even point would decrease.
• C) The contribution margin would increase.
• D) The contribution margin would decrease.
• E) More than one of the other answers would occur.

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Definitions:

Pulsating

Describes a physical or electrical effect that occurs in intervals, typically experienced as oscillations or vibrations.

Sine

A mathematical function that describes the ratio of the length of the opposite side to the length of the hypotenuse in a right-angled triangle, often related to waveforms in physics.

Linear

When used in comparing electric devices or quantities, signifies that one unit is equal to another.

RMS

Root Mean Square, a statistical measure of the magnitude of a varying quantity, commonly used to calculate the effective value of an alternating current.