The economic break-even point is the number of units that must be sold each year over the life of a project in order for the NPV of that project to equal to _____.
A) $0
B) $1
C) the present value of cash inflows
D) the present value of investment

Question

Quizplus · Accepted Answer

The economic break-even point is the level of sales volume where the NPV of the project is equal to zero, which means that the total present value of cash inflows is equal to the total present value of cash outflows (investment). Therefore, choice A is the correct answer.

The Economic Break-Even Point Is the Number of Units That