An increase in sales will always increase a company's gross profit margin.

Name: An increase in sales will always increase a company's gross profit margin.
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Question

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An increase in sales does not always increase a company's gross profit margin because the gross profit margin also depends on the cost of goods sold. If the cost of goods sold increases at a faster rate than sales, the gross profit margin can actually decrease.

An Increase in Sales Will Always Increase a Company's Gross