The increasing factor of the break-even quantity.

Question

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Answer 1

Question

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.

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Answer 2

Question

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.

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Answer 3

Question

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.

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Answer 4

Question

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.

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Answer 5

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.

Answer 6

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.

Answer 7

Chapter 5, Problem 1MC

To determine

The increasing factor of the break-even quantity.

Answer 8

Expert Solution & Answer

Explanation of Solution

Option (c)

The break-even point refers to a point in the level of operations at which a company experiences that its revenue generated is equal to its cost incurred. The break-even point can be calculated using the following formula:

Break-even point=Fixed costPice−Marginal cost (1)

As per Equation (1), a decrease in the price level will decrease the denominator and thereby increase the break-even quantity. Therefore, a fall in the price level will increase the break-even quantity and thus, option (c) is correct.