Refer to the following break-even chart to answer the question(s)below:

-The area labeled ________ represents the firm's fixed expenses, while ________ represents its variable expenses.
A)Z; W
B)X; Y
C)Y; X
D)W; Z

Question

Refer to the following break-even chart to answer the question(s)below:
 
-The area labeled ________ represents the firm's fixed expenses, while ________ represents its variable expenses.
A)Z; W 
B)X; Y 
C)Y; X 
D)W; Z

Quizplus · Accepted Answer

In a break-even chart, the area labeled X represents fixed expenses, while the area labeled Y represents variable expenses. This is because fixed expenses remain constant regardless of the level of output, while variable expenses increase as production levels increase. Therefore, the correct choice is B where X represents fixed expenses and Y represents variable expenses.

Refer to the Following Break-Even Chart to Answer the Question(s)below