ocr: The Three Profitability Factors Each of these three tactors is dependent upon the other two and thus changes inc one tactor will necessarily have an impact on the remaining two tactors. For example, ifal business's costs increase they may be forced into raising their selling prices. As: selling prices increase they may find that market demand for their products decline. However, a fall in sales volume will mean that the business will be spreading it's costs over a lower volume of sales and hence unit costs will increase and the negative impact on profits will be reintorced. Alternatively, if a ...
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