The "Contribution-Margin Approach" to Marketing Cost Analysis

question 37

Multiple Choice

The "contribution-margin approach" to marketing cost analysis:

• A) Focuses attention on the allocation of fixed costs.
• B) Is mainly concerned with the allocation of variable costs.
• C) Always leads to the same conclusions as the "full-cost approach."
• D) Is always preferred to the "full-cost approach."
• E) None of these are correct.

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Definitions:

Transport Vehicles

Means of conveyance designed for moving goods or passengers from one location to another.

Prototype

A mental image or best example of a category. Matching new items to a prototype provides a quick and easy method for sorting items into categories (as when comparing feathered creatures to a prototypical bird, such as a crow).

Category

A class or division of people or things regarded as having particular shared characteristics.

Mental Grouping

The cognitive process of categorizing objects or information based on shared attributes or relations, aiding in understanding and memory.