Break-even analysis is:
A)the process of determining the quantity of product consumers will buy relative to the quantity produced by the firm.
B)a technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output.
C)a method of determining just how much a consumer is willing to pay for a product or service.
D)a process that investigates the magnitude of difference between marginal revenue and marginal cost.

Question

Quizplus · Accepted Answer

Break-even analysis is a technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output. It helps in finding the level of sales where the total revenue equals total cost, leading to neither profit nor loss. It is an important tool for businesses to make decisions about pricing, production quantity, and overall profitability.

Break-Even Analysis Is