Question

If a company increases its fixed costs for product​ b, then the contribution margin per unit will.

Answer 1

If a company increases its fixed costs for product​ b, then the contribution margin per unit will remain the same.

What is fixed cost?

• Fixed costs, sometimes referred to as indirect costs or overhead costs in accounting and economics, are costs incurred by a corporation that are independent of the volume of goods or services the company produces.
• They frequently occur again and again, like monthly rent or interest payments.
• These expenses are often capital expenses as well.
• Contrast this with variable costs, which depend on volume (and are based on the quantity produced) and are unknowable at the start of the accounting year.
• Some variable costs are affected by the type of fixed costs.

What is company?

• A corporation, often known as co., is a legal entity that stands for a group of people with a certain goal who are either natural, legal, or a combination of the two.
• Members of the company work together for a shared cause in order to accomplish clearly stated objectives.

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