Post Utme Caleb University 2024 Commerce Question 38

Practice objective / multiple choice question 38 from the 2024 Post Utme Caleb University Commerce examination.

Post Utme Caleb University 2024 Commerce Objective / Multiple Choice
Question 38 POST_UTME_CALEB_UNIVERSITY • 2024 • COMMERCE • objective

A company has a contract with a supplier to purchase a certain quantity of raw materials at a fixed price. However, the supplier has informed the company that there will be a shortage of raw materials and that the price will increase by 20%. What is the effect on the company's profit margin?

Answer Options

A. The profit margin will increase by 20%
Correct Answer B. The profit margin will decrease by 20%
C. The profit margin will remain unchanged.
D. The profit margin will increase by 10%
Correct Answer
B
Correct Option:
The profit margin will decrease by 20%

About This Question

This is Post Utme Caleb University 2024 Commerce Question 38. It is one of the objective questions from the 2024 Post Utme Caleb University Commerce examination.

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