The NMC of any proposed strategy must be lower than the current NMC in order to increase a business's net profit.

Question

Quizplus · Accepted Answer

The statement is incorrect. NMC (Net Marginal Contribution) is the amount by which revenue exceeds the variable cost of producing the goods or services sold. Lowering NMC would mean reducing variable costs or increasing revenue, which may or may not result in increased net profit depending on the fixed costs and other factors.

The NMC of Any Proposed Strategy Must Be Lower Than