Total Revenue

question 79

Multiple Choice

Total revenue

• A)always increases as price increases.
• B)increases as price increases,as long as demand is elastic.
• C)decreases as price increases,as long as demand is inelastic.
• D)remains unchanged as price increases when demand is unit elastic.

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Definitions:

CM Ratio

Contribution margin ratio, showing the portion of sales revenue that is not consumed by variable costs and contributes to covering fixed costs.

Fixed Expenses

Costs that do not fluctuate with the level of production or sales, such as rent, salaries, and insurance premiums.

Units

A measure of quantity for items that are being produced, sold, or inventoried by a company.

Target Profit

The profit a company aims to achieve for a specific period.