Tower Company Manufactures and Sells a Single Product with a Positive

Multiple Choice

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 5% and fixed costs do not change,what is the effect on the contribution margin per unit and the contribution margin ratio? $$\begin{array} { | c | c | c | } \hline & \text { Contrbution margin per unit } & \text { Contribution margin ratio } \\\hline \text { A. } & \text { No change } & \text { No change } \\\hline \text { B. } & \text { Increase } & \text { Increase } \\\hline \text { C. } & \text { Increase } & \text { No change } \\\hline \text { D. } & \text { Increase } & \text { Decrease } \\\hline\end{array}$$

A) Option A
B) Option B
C) Option C
D) Option D