If a Firm Sells More Than One Product,the Break-Even Point

question 32

Multiple Choice

If a firm sells more than one product,the break-even point in units represents:

• A)the number of units of the largest-selling product required to break even.
• B)the number of units of the most profitable product required to break even.
• C)the number of units of the highest-revenue product required to break even.
• D)the sum of the units of all products required to break even.

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Definitions:

Back-end Load

A fee paid by investors when they sell shares of a mutual fund, often decreasing over time the longer shares are held.

Annual Fees

Charges that must be paid yearly for membership or participation, often associated with credit cards, investment funds, and various types of subscriptions.

Futures

Financial contracts obligating the buyer to purchase an asset, or the seller to sell an asset, at a predetermined future date and price.

Options

Financial derivatives that provide the holder the right, but not the obligation, to buy or sell an asset at a predetermined price on or before a specific date.