Answer:
Option (b) is correct.
Explanation:
Contribution margin ratio is the difference between the selling price of the product and the variable cost of the product.
Contribution margin ratio = Selling price - Variable cost
Now, if there is a decrease in the fixed costs and variable costs of the product then as a result contribution margin ratio increases because of the fall in variable cost.
Break even point = (Fixed expense ÷ Contribution margin ratio)
If there is an increase in the contribution margin ration and a reduction in the fixed expense then as a result break even point decreases.
Increased; Decreased
Answer: Option D
Explanation: Competitive advantage refers to situation when an organisation gets favorable advantage in the market over its competitors.
In the given case, Belinda is trying to establish business in the industry which already has heavy competition. Therefore, if she wants to establish a customer base, she must need some competitive advantage so that she can operate with low profits initially.
Hence from the above we can conclude that the correct option is D.
This question is mainly about YOUR opinion. Many will say that it will, but some will say it shouldn't. This is based entirely on your opinion.