If a firm's variable costs per unit increase, the firm's operating breakeven point will
A) decrease.
B) increase.
C) remain unchanged.
D) change in an undetermined direction.

Question

Quizplus · Accepted Answer

If the variable costs per unit increase, it means that the firm incurs higher costs to produce each unit of product. This will, in turn, increase the firm's overall cost structure, and as a result, the operating breakeven point will also increase. Therefore, the best answer is B - increase.

If a Firm's Variable Costs Per Unit Increase, the Firm's