Break-Even Analysis Can Be Useful for

question 74

Multiple Choice

Break-even analysis can be useful for

• A)estimating future sales.
• B)setting the most profitable price.
• C)comparing pricing alternatives.
• D)relating assumed prices to demand estimates.
• E)creating a pricing solution.

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Definitions:

Financing Activities

Transactions that result in changes in the size and composition of the equity and borrowings of a company, as reflected in its cash flows.

Free Cash Flow

The amount of cash a company produces through its operations, after subtracting the cost of expenditures on assets.

Net Cash

The difference between a company’s total cash inflows and cash outflows in a given period.

Investing Activities

Part of a company's cash flow statement that shows the outflow and inflow of cash from investments in property, plant, equipment, and financial securities.