When the Level of Fixed Costs Is Decreased, the Break-Even

question 120

Multiple Choice

When the level of fixed costs is decreased, the break-even level of revenues:

• A)Will automatically decrease
• B)Will automatically increase
• C)May or may not be changed, depending on variable costs
• D)Will remain unchanged, because fixed costs cannot be altered

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Definitions:

Component Weight

This refers to the proportional value of each component within a portfolio or mixture, often used in finance to denote the percentage of each asset in a total investment portfolio.

Market Values

The current price at which an asset or service can be bought or sold in an open and competitive marketplace.

Yield To Investors

The total return anticipated on an investment, expressed as an annual percentage, accounting for all income and capital gains.

Marginal Tax Rate

The rate at which the last dollar of a taxpayer's income is taxed, indicating how much of additional income will be taken in taxes.