If Product Costs Plus Allocated Support Costs Are Used to Set

Multiple Choice

If product costs plus allocated support costs are used to set prices:
I. Prices increase as the volume of production decreases
II. Price increases cause further decreases in quantity demanded, causing production to decrease
III. The company may eventually go out of business

A) I and II only
B) II and III only
C) I and III only
D) I, II, and III