At the Breakeven Point

question 94

Multiple Choice

At the breakeven point,

• A)sales revenue equals zero.
• B)contribution margin equals total variable costs.
• C)sales revenue equals total costs.
• D)operating income equals total costs.

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Definitions:

Disposable Income

Money that households can allocate towards savings and spending after income tax charges.

C + I

An economic term that represents the sum of consumer spending (C) and investment spending (I); key components of the Gross Domestic Product (GDP) formula.

Investment

The allocation of resources, such as capital or time, in the hope of generating future profits or benefits.

Capacity Utilization Rate

The percentage of a firm's total production capacity that is actually being used in production.