When the Total Fixed Costs Decrease,the Breakeven Point ________

question 284

Multiple Choice

When the total fixed costs decrease,the breakeven point ________.

• A) increases
• B) decreases
• C) remains the same
• D) increases proportionately

---

Definitions:

Long-Run Equilibrium

A state in which all factors of production and costs are variable, and the economy or the firm is fully adjusted to economic conditions, with no excess demand or supply in any market.

Efficient Scale

The level of production that minimizes the average total cost of producing a good or service. It represents the most cost-effective point of operation for a business.

Maximum Profit

The highest possible profit a firm can achieve when it has optimized its production and sales, given the constraints of the market.

Long-Run Adjustment

The process through which inputs and outputs fully adjust to changes in the market, considering all potential variable and fixed costs.