When Break-Even Analysis Is Applied to an Outsourcing Decision, the Break-Even

Multiple Choice

When break-even analysis is applied to an outsourcing decision, the break-even quantity is _____.

A) the ratio of fixed costs to the difference between variable outsourcing cost and variable in-house production cost
B) the ratio of the difference between variable outsourcing cost and variable in-house production cost to fixed costs
C) the product of the variable costs and the fixed costs
D) the product of the variable costs and the production quantity