If the break-even point increases, the margin of safety increases.

Name: If the break-even point increases, the margin of safety increases.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

If the break-even point increases, it means that a higher level of sales is required to cover the fixed and variable costs, which reduces the margin of safety. Therefore, the correct statement would be: if the break-even point decreases, the margin of safety increases.

If the Break-Even Point Increases, the Margin of Safety Increases