The accuracy of cost-volume-profit analysis is limited because it assumes a strictly linear relationship between the variables.

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Cost-volume-profit analysis assumes that the relationship between cost, volume, and profit is strictly linear, which may not always hold true in the real world. For example, economies of scale or changes in pricing strategies can result in non-linear relationships between these variables. Therefore, the accuracy of cost-volume-profit analysis is limited.

The Accuracy of Cost-Volume-Profit Analysis Is Limited Because It Assumes