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.

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Definitions:

Behavioral Segmentation

The division of a market into groups based on consumer behaviors and purchasing decisions, allowing for more targeted marketing strategies.

Over 40 Weeks

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National Car Rental

A rental car agency based in the United States, providing vehicle rental services to customers worldwide.

80/20 Rule

A principle suggesting that 80% of effects come from 20% of causes, often used in business and economics to focus efforts on the most productive inputs.