Which statement best describes the relationship between S&A Rate and S&A Expense?

• A. Rate is the ratio of S&A Expense to Placement
• B. Rate is the sum of S&A Expense and Placement
• C. Rate equals S&A Expense times Placement
• D. Rate is independent of Expense and Placement

Answer: (A)

S&A Rate is a measure of how much S&A expense is incurred for each placement, so it is defined as S&A Expense divided by Placement. This creates a cost-per-placement figure, linking the two quantities directly. For example, if S&A Expense is 50,000 and there are 2,500 placements, the rate is 20 per placement. It must be a ratio, not a sum or a product, and it cannot be independent of expense and placement. The ratio form captures how changes in either expense or the number of placements affect the cost per placement.