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If the Selling Price Per Unit Were to Drop $2

Question 42

Multiple Choice

If the selling price per unit were to drop $2, from $100 to $98, the sales volume were to increase 500 units to 4,500 units per month, and advertising expense were to increase by $1,000: If the selling price per unit were to drop $2, from $100 to $98, the sales volume were to increase 500 units to 4,500 units per month, and advertising expense were to increase by $1,000:   A)  the break-even point would increase. B)  the break-even point would decrease. C)  the contribution margin ratio would increase. D) operating income would decrease.


A) the break-even point would increase.
B) the break-even point would decrease.
C) the contribution margin ratio would increase.
D) operating income would decrease.

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