FIGURE 6- 1 -Refer to Figure 6- 1. Marginal Utility Is Zero When

question 44

Multiple Choice

FIGURE 6- 1
-Refer to Figure 6- 1. Marginal utility is zero when total utility is

• A) is increasing.
• B) equal to zero.
• C) at its maximum.
• D) is decreasing.
• E) equal to marginal utility.

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Definitions:

Margin of Safety

The difference between actual or expected sales and sales at the break-even point. It measures how close a company is to not covering its fixed costs.

Break-even Sales

The amount of revenue from sales that exactly covers the fixed and variable costs of producing and selling a product, with no profit or loss.

Pretax Net Income

The amount of money a company has earned before taxes are deducted.

Fixed Costs

Expenses that do not fluctuate with the volume of production or sales, such as rent, salaries, and insurance.