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Evaluating the margin of safety

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Question 1: Needles, Inc. was evaluating its margin of safety. Which one of the following is true?

Option 1: The break-even point is not relevant.

Option 2: The higher the ratio, the greater the margin of safety.

Option 3: The higher the dollar amount, the lower the margin of safety.

Option 4: The higher the ratio, the lower the fixed costs.

Reference no: EM132604805

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