If the Price Decreases, but Fixed and Variable Costs Do

question 78

Multiple Choice

If the price decreases, but fixed and variable costs do not change, the break-even point

• A) decreases
• B) increases
• C) remains the same
• D) may increase or decrease, depending on sales

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Definitions:

Simple Interest

Interest calculated only on the original principal, not on the accumulated interest from previous periods.

Maturity Value

The amount payable to an investor at the end of a debt instrument's life, including both the principal and the interest.

Promissory Note

A financial document in which one party promises in writing to pay a determinate sum of money to another, either at a fixed or determinable future time or on demand.

Return on Investment

A performance measure used to evaluate the efficiency or profitability of an investment or compare the efficiency of a number of different investments.