A Weakness of Break-Even Analysis Is That It Assumes

question 33

Multiple Choice

A weakness of break-even analysis is that it assumes

• A)revenue and costs are a linear (constant) function of volume.
• B)prices and costs increase when the economy is strong and confidence is high.
• C)the cost of goods sold goes up as revenue increases.
• D)None of the options

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Definitions:

Government Bonds

Securities issued by a government to finance its expenditures, offering regular interest payments and the return of the original investment at maturity.

Demand Deposits

Bank accounts that allow the withdrawal of deposited money at any moment, without the need to notify the bank beforehand.

Loans

A sum of money that is borrowed, which is expected to be paid back with interest.

Bureau of Labor Statistics

A U.S. government agency that collects, processes, and disseminates essential statistical data related to labor market activity, working conditions, and price changes.