Answer the following questions using the information below:
Cox Lighting manufactures table lamps and is considering raising the price by $20 a unit for the coming year. With a $20 price increase, demand is expected to fall by 2,000 units.

-Would you recommend the $20 price increase?
A)No, because demand decreased.
B)No, because the selling price increases.
C)Yes, because contribution margin per unit increases.
D)Yes, because operating income increases.

Question

Answer the following questions using the information below:
Cox Lighting manufactures table lamps and is considering raising the price by $20 a unit for the coming year. With a $20 price increase, demand is expected to fall by 2,000 units.
 
-Would you recommend the $20 price increase?
A)No, because demand decreased. 
B)No, because the selling price increases. 
C)Yes, because contribution margin per unit increases. 
D)Yes, because operating income increases.

Quizplus · Accepted Answer

The Answer of Answer the following questions using the information below:
Cox Lighting manufactures table lamps and is considering raising the price by $20 a unit for the coming year. With a $20 price increase, demand is expected to fall by 2,000 units.
 
-Would you recommend the $20 price increase?
A)No, because demand decreased. 
B)No, because the selling price increases. 
C)Yes, because contribution margin per unit increases. 
D)Yes, because operating income increases.

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