Break-Even Analysis

question 238

Multiple Choice

Break-even analysis

• A) can be adapted to evaluate the quantity that needs to be sold to earn a target profit--by adding the target profit to fixed costs.
• B) may result in a "break-even" quantity that it would be impossible to sell at the assumed price.
• C) focuses on the contribution of each unit sold to the reduction of fixed costs.
• D) All of the above are true.
• E) None of the above is true.

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Definitions:

Sample Size

is the number of observations or data points collected in a study or used in a statistical sample.

Control Limits

These are the boundaries in a control chart, beyond which a process is considered to be out of control indicating an issue that needs investigation.

Average Range

The statistical measure representing the difference between the highest and lowest values in a set, divided by the number of observations.

Inspection Samples

Refers to a selection of items taken from a larger population and tested or inspected to determine the quality or performance of the whole.