The Method of Determining the Minimum Sales Volume Needed at a Certain

question 23

Multiple Choice

The method of determining the minimum sales volume needed at a certain price level to cover all costs is

• A)market share analysis.
• B)equilibrium pricing analysis.
• C)return on sales analysis.
• D)breakeven analysis.

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Definitions:

NPV

Net Present Value, a method used in capital budgeting to evaluate the profitability of an investment or project.

IRR

Internal Rate of Return, a financial metric used to estimate the profitability of potential investments.

Fixed Costs

Expenses that do not change with the level of production or sales over a short period, such as rent or salaries.

Operating Cash Flow

The cash generated from the normal operating activities of a business within a specific time period.