I don´t get it plzz help me

1) Decrease

Explanation:

The gross profit margin ratio is a profitability ratio that basically shows us how well the company is using its assets to cover its production costs. It is calculated by subtracting total revenue from cost of goods sold and then dividing by total revenue:

As any ratio, it doesn't tell anything by itself but it is very useful when comparing different companies that operate in the same industry. It basically tells us how profitable our business is when only required to cover production costs (COGS). It is always used together with the net profit margin because it will tell us where the company is spending the most.

If the company has a very good (high) gross profit ratio but a very low net profit ratio, it means that fixed costs are probably too high.