All other things the same, a decrease in variable expense per unit will reduce the break-even point.

Question

Quizplus · Accepted Answer

Variable expenses are costs that change with variations in productivity. If variable expense per unit decreases, the overall cost of making each unit decreases as well, which, in turn, will reduce the break-even point. Therefore, a decrease in variable expense per unit will reduce the break-even point.

All Other Things the Same, a Decrease in Variable Expense