When the sales increase from Rs 40,000 to Rs 60,000 and profit increases by Rs 5,000, the P/V ratio is —
- 0.25
- 6.78
- 1.00
- 2.00
Explanation
Increase in sales = Rs. 60000 - Rs. 40000 = Rs. 20000
PV Ratio = Increase in Profit / Increase in sales
= 5000 / 20000 = 0.25
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