Price fluctuations can affect profitability. Is this statement correct?

Price fluctuations can affect profitability. Is this statement correct?
A . Yes, if the product’s costs increase and the price does not
B . No, only decisions made by the chief executive affect the price
C . No, price is not related to profitability
D . Yes, as sales may drop if the product is price inelastic

View Answer

Answer: A

Explanation:

Profitability is impacted when product costs rise without corresponding price adjustments.

Understanding cost-price relationships is key to managing profitability in procurement.