In General, an Increase in Fixed Cost While the Contribution

question 85

Multiple Choice

In general, an increase in fixed cost while the contribution margin remains unchanged will

• A) increase the break even point.
• B) decrease the break even point, but only if the safety margin is positive.
• C) either increase or decrease the break even point, depending on operation leverage.
• D) have no impact on break even point.

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Definitions:

Pregnant

The state of carrying a developing fetus within the female uterus.

Labor

The process of childbirth, especially the period from the start of contractions to delivery, or the physical and mental effort involved in working.

Delivery

In the context of services and goods, it refers to the process of transporting products from a source to a predefined destination.

Birth Process

The series of physiological and mechanical actions through which a fetus is expelled from the uterus and becomes a neonate.