Holding All Other Things Constant,an Increase in Fixed Selling Costs

question 2

Multiple Choice

Holding all other things constant,an increase in fixed selling costs will affect:

• A)the selling price under the absorption costing approach to cost-plus pricing.
• B)the profit-maximizing price.
• C)both the selling price under the absorption costing approach to cost-plus pricing and the profit-maximizing price.
• D)neither the selling price under the absorption costing approach to cost-plus pricing nor the profit-maximizing price.

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Definitions:

Interest Rate

The interest rate is the percentage of the principal charged by a lender to a borrower for the use of assets, typically expressed as an annual percentage.

Years From Now

A temporal reference indicating a certain amount of time in the future from the current point.

Real Wages

Nominal wages corrected for inflation.

Money Wages

The current dollar amount of a person’s wages.