If both the variable cost per unit and the selling price per unit decrease,the new contribution margin ratio in relation to the old contribution margin ratio will be:
A)Lower.
B)Higher.
C)Unchanged.
D)Not enough information to tell.

Question

Quizplus · Accepted Answer

The contribution margin ratio depends on the specific amounts by which the variable cost and selling price decrease. Without knowing these amounts, it's impossible to determine the effect on the contribution margin ratio.

If Both the Variable Cost Per Unit and the Selling