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Which of the Following Is (Are) Relevant with Respect to the Decision

Question 47

Multiple Choice

Which of the following is (are) relevant with respect to the decision as to whether a product line
Should be dropped?
I. The product line's contribution margin.
II. The product line's avoidable fixed expenses.
III. The product line's unavoidable fixed expenses.
IV. The impact of the decision to drop the product on the sales of the company's other products.
V. The potential use of the freed capacity resulting from dropping the product line.


A) I, II, and IV
B) I, II, IV, and V
C) I, III, and IV
D) They are all relevant.

Correct Answer:

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