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A company with a higher contribution margin ratio is either more or less sensitive to changes in sales revenue, depending on other factors. likely to have a lower breakeven point. less sensitive to changes in sales revenue. more sensitive to changes in sales revenue.

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Lanuel

Answer:

more sensitive to changes in sales revenue.

Explanation:

Contribution margin can be defined as the subtraction of variable cost from the sales price.

Mathematically, it given by the formula;

[tex] Contribution \; margin = sales \; price - variable \;cost[/tex]

Variable cost refers to cost which are the same per unit of production but vary directly with level of output.

Generally, a company that has a higher contribution margin ratio is more sensitive to changes in sales revenue because it affects it in the long-run.

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