If All Other Factors Remain the Same a 20% Increase

question 25

Multiple Choice

If all other factors remain the same a 20% increase in both the selling price and variable costs of a product will:

• A)Lower the company's break-even point in units
• B)Raise the company's break-even point in units
• C)Have no effect on the company's break-even point in units
• D)Cannot be determined without more information

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Definitions:

Distributive Property

A property indicating that a(b+c) equals ab + ac, applicable for multiplication over addition or subtraction.

Associative Property

A mathematical rule stating that the way in which numbers are grouped in addition or multiplication does not change their sum or product.

Terms

Components of an expression or equation, separated by plus or minus signs, representing quantities or variables.