When the selling price per unit decreases,the contribution margin per unit ________.
A) increases proportionately
B) increases
C) remains the same
D) decreases

Question

Quizplus · Accepted Answer

When the selling price per unit decreases, the contribution margin per unit decreases as well. This is because contribution margin is calculated as the selling price per unit minus the variable cost per unit, therefore if the selling price decreases, the contribution margin will decrease as well.

When the Selling Price Per Unit Decreases,the Contribution Margin Per