The Break-Even Point Is

question 47

Multiple Choice

The break-even point is:

• A) always calculated from the difference between average cost and average revenue in the short run
• B) always calculated from the difference between total costs and total revenues in the short run
• C) always calculated from the difference between average fixed cost and average revenue in the short run
• D) always greater than the shut-down point in the short run

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Definitions:

Marginal Productivity Theory

An economic theory that explains how the value of a productive input is determined by its contribution to the total output.

Income Distribution

The way in which total income is divided among the members of a society.

Marginal Contribution

The additional amount of revenue or benefit generated by utilizing one more unit of a resource or producing one additional unit of a product.

Complementary Resources

Assets or inputs that enhance the value or performance of another asset or input when used in conjunction, such as gasoline for cars or software for computers.