In breakeven analysis, the point of intersection between the cost curves of two alternatives represents
A) The volume at which all costs are minimized
B) The volume at which the cost of the low-cost alternative is minimized
C) The volume at which the cost of the high-cost alternative is minimized
D) The optimal production volume
E) The volume at which the costs of the two alternatives are the same

Question

Quizplus · Accepted Answer

The point of intersection between the cost curves of two alternatives in breakeven analysis represents the volume at which the costs of the two alternatives are the same. This is the breakeven point where the total costs of both alternatives equal each other.

In Breakeven Analysis, the Point of Intersection Between the Cost