If the selling price per unit increases,what is the effect on the break-even point? (Assume no other changes.)
A) The break-even point increases.
B) The break-even point decreases.
C) The break-even point remains the same.
D) The break-even point is zero.

Question

Quizplus · Accepted Answer

If the selling price per unit increases, the contribution margin per unit also increases. As the contribution margin increases, the break-even point decreases. This is because the company needs to sell fewer units to cover its fixed costs and start making a profit. Therefore, option B is the correct answer.

If the Selling Price Per Unit Increases,what Is the Effect