Basic Break-Even Analysis Typically Assumes That

Multiple Choice

Basic break-even analysis typically assumes that:

A) revenues increase in direct proportion to the volume of production, while costs increase at a decreasing rate as production volume increases.
B) variable costs and revenues increase in direct proportion to the volume of production.
C) both costs and revenues are made up of fixed and variable portions.
D) costs increase in direct proportion to the volume of production, while revenues increase at a decreasing rate as production volume increases because of the need to give quantity discounts.
E) All of these are assumptions in the basic break-even model.