Interpretation of accounting ratios — practice question

Miranda’s gross margin declined from $25\%$ in year 1 to $15\%$ in year 2. What could have led to this?

• AMiranda paid less for her purchases in year 2.
• BMiranda purchased fewer goods in year 2.
• CMiranda reduced her selling prices in year 2.
• DMiranda sold fewer goods in year 2.