Once a Firm Reaches the Breakeven Point, the Next Unit

question 144

Multiple Choice

Once a firm reaches the breakeven point, the next unit sold will increase profit by an amount equal to the:

• A) Selling price per unit
• B) Variable cost per unit
• C) Contribution margin per unit
• D) Difference between contribution margin and fixed costs

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Definitions:

Brick-and-mortar

Refers to a traditional business that operates in a physical store or building rather than online.

Purely Physical

Pertaining exclusively to the material or tangible aspects of something, devoid of any digital, virtual, or intangible components.

Freemium

A business model where basic services are provided free of charge while more advanced features must be paid for.

Subscription

An arrangement to receive products or services, such as publications or software, on a regular basis by paying a fee.