Calculate the Contribution Margin, If the Variable Cost Per Unit

question 30

Multiple Choice

Calculate the contribution margin, if the variable cost per unit to produce a microwave is $39 and a contribution rate is 45%.

• A) $17.55
• B) $1.15
• C) $70.91
• D) $31.91
• E) $39

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Definitions:

Substitutes

Products that serve similar purposes. An increase in the price of one will cause an increase in demand for the other (examples are hamburgers and tacos, butter and margarine, Chevrolets and Fords).

Cable TV

is a system of delivering television programming to consumers via radio frequency signals transmitted through coaxial cables.

Satellite TV

A television system that delivers programming to viewers by broadcasting from a communications satellite orbiting the Earth directly to the viewer's location.

Stock Market

This term refers to the aggregation of buyers and sellers of stocks, which represent ownership claims on businesses, including securities listed on public stock exchanges.