If a firm's net income does not change as its volume changes,the firm('s)
A)must be in the service industry.
B)must have no fixed costs.
C)sales price must equal $0.
D)sales price must equal its variable costs.

Question

Quizplus · Accepted Answer

If a firm's net income remains constant regardless of changes in volume, it implies that its revenue per unit sold exactly matches its variable costs per unit. This means that each additional unit sold neither adds to nor subtracts from the net income, indicating that the sales price per unit is equal to the variable costs per unit. Choices A, B, and C do not directly relate to the condition where net income remains unchanged with volume changes.

If a Firm's Net Income Does Not Change as Its