From 2016 to 2017, Company A's gross profit margins showed which of the following?

1. a favorable increase
2. a favorable decrease
3. an unfavorable increase
4. an unfavorable decrease
5. neither a favorable nor unfavorable increase or decrease

I already know that b & d are incorrect but I do not know why. When I calculated the answer I showed that gross profit margin decreased from 35.05% in 2016 to 34.89% in 2017. Please explain to me how you come up with the correct answer if it is not either of the two I chose.

Answer rating: 100% (QA)

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