Which One of the Following Statements About Break-Even Analysis, as We

question 79

Multiple Choice

Which one of the following statements about break-even analysis, as we applied it to evaluating products or services, is best?

• A) Break-even analysis assumes that the cost function is linear and consists of fixed costs plus variable costs times volume.
• B) The break-even quantity will increase when the change in variable cost per unit is identical to the change in unit price.
• C) Increasing the price, while keeping the variable cost per unit constant, increases the break-even quantity.
• D) Increasing the fixed costs tends to decrease the break-even quantity.

---

Definitions:

Indorsement in Trust

A specification on a negotiable instrument where the indorsement indicates that the endorsee has trustee status, making them responsible for managing the instrument according to trust terms.

Bearer Instrument

A negotiable financial instrument that designates payment to whoever holds the instrument, not requiring ownership to be registered with the issuer.

Indorsed

The act of signing one's name on the back of a check or other negotiable instrument for the purpose of transferring rights or entitlements.

Ratification

The formal approval of an agreement, treaty, or act, making it officially valid.