Question

Which tool can be used to easily calculate the change in profit resulting from a change in sales price, sales volume, variable costs, or fixed costs?

Multiple choice question.

Fixed cost analysis


Variable expense ratio


CVP analysis


Return on investment

Answer 1

The tool that can be used to easily calculate the change in profit resulting from a change in sales price, sales volume, variable costs, or fixed costs is:

**CVP analysis (Cost-Volume-Profit analysis)**.

This method helps businesses understand how changes in costs and volume affect a company's operating income and net income.