A typical break-even analysis assumes that:
A) the marginal revenue from an additional unit sold is constant.
B) the fixed-cost contribution per unit decreases as units sold increases.
C) marginal cost from an additional unit sold is dropping.
D) All of the above.
E) None of the above.

Question

Quizplus · Accepted Answer

A typical break-even analysis assumes that the marginal revenue from an additional unit sold is constant. Fixed-cost contribution per unit and marginal cost from an additional unit sold may vary, but the assumption of constant marginal revenue is the key factor in break-even analysis.

A Typical Break-Even Analysis Assumes That