To increase the contribution margin a ﬁrm must either _____ or _____.
A) Increase its sales price; increase its ﬁxed cost per unit.
B) Increase its sales price; decrease its variable cost per unit.
C) Increase its sales price; decrease its ﬁxed cost per unit.
D) Increase its variable cost per unit; decrease its ﬁxed cost per unit.
E) Decrease its variable cost per unit; decrease its ﬁxed cost per unit.

Question

Quizplus · Accepted Answer

To increase the contribution margin, a firm must either increase its sales price or decrease its variable cost per unit, as the contribution margin is calculated as sales price minus variable costs.

To Increase the Contribution Margin a ﬁRm Must Either _____