Break-Even Analysis

Multiple Choice

Break-even analysis:

A) based on accounting profits is preferable to the financial (or present value) break-even method.
B) identifies the optimal maximum level of output for any given level of fixed assets.
C) ignores both taxes and interest when computing the financial break-even point.
D) provides a means of determining the minimal number of units that need to be sold to prevent a financial loss.
E) identifies the optimal sales price for any new product.