Holding All Other Things Constant, an Increase in Fixed Production

question 54

Multiple Choice

Holding all other things constant, an increase in fixed production 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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