1. When income increase profit decreases
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Answer:
Increasing revenue can result in higher costs and lower profit margins. Cutting costs can result in diminished sales and also lower profit margins if market share is lost over time.
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Answer:
An obvious reason for a decline in operating profit is a decline in income. However, it's possible to increase your income revenues and suffer a profit decrease. This can occur if your sales increase comes from higher sales of low-margin items while you suffer a decrease of income of high-margin products.
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