Break-even analysis determines the level of a parameter that makes the project's NPV equal to
A) a positive number.
B) zero.
C) a negative number.
D) none of the above.

Question

Quizplus · Accepted Answer

The break-even analysis calculates the level of a parameter such as sales volume, price, or cost that makes the project's NPV zero. This is the point where the project is neither profitable nor unprofitable, and it covers only its costs. Therefore, the correct choice is B.

Break-Even Analysis Determines the Level of a Parameter That Makes