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

Question

Quizplus · Accepted Answer

The operating breakeven point is determined by fixed operating costs, not fixed financial costs. Therefore, a change in fixed financial costs does not affect the operating breakeven point.

If a Firm's Fixed Financial Costs Decrease, the Firm's Operating