If the sales mix shifts to one unit of Product Q and two units of Product P,then the break-even point will:

Question

Quizplus · Accepted Answer

If the sales mix shifts to one unit of Product Q and two units of Product P, the contribution margin per unit will increase because Product Q has a higher contribution margin per unit than Product P. As a result, the break-even point will decrease because it is the point where total revenue equals total costs, and a higher contribution margin per unit means a smaller number of units are needed to cover the fixed costs and reach the break-even point. Therefore, the best choice is B, decrease.

If the Sales Mix Shifts to One Unit of Product