With increasing costs, especially fixed operating and financial cost-comes increasing risk, since thefirm will have to achieve a higher level of sales just to break even.

Question

Quizplus · Accepted Answer

This statement is true. As costs increase, the firm will need to generate a higher level of sales just to cover those costs, which increases the risk of not being able to achieve the needed sales and potentially facing financial losses.

With Increasing Costs, Especially Fixed Operating and Financial Cost-Comes Increasing