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Tower Company manufactures and sells a single product with a positive contribution margin. If the selling price and the variable cost per unit both increase
Tower Company manufactures and sells a single product with a positive contribution margin. If the selling price and the variable cost per unit both increase and fixed costs do not change, what is the effect on the contribution margin per unit and the contribution margin ratio?
Contribution margin per unit Contribution margin ratio
A No change No change
B Increase Increase
C Increase No change
D Increase Decrease
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