Which of the following statements is true if the sales price per unit decreases while the variable cost per unit and total fixed costs remain constant?

Question

Quizplus · Accepted Answer

If the sales price per unit decreases while the variable cost per unit and total fixed costs remain constant, the contribution margin per unit will decrease. This is because the contribution margin is calculated by subtracting the variable cost per unit from the sales price per unit. As a result, the overall contribution margin will also decrease. Since the contribution margin has decreased, the breakeven point will increase. This is because the breakeven point is calculated by dividing the total fixed costs by the contribution margin per unit.

Which of the Following Statements Is True If the Sales