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Author Question: Basic break-even analysis typically assumes that (Read 95 times)

berenicecastro

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Question 1

Which of the following costs would be incurred even if no units were produced?
◦ purchasing costs
◦ raw material costs
◦ direct labour costs
◦ transportation costs
◦ building rental costs

Question 2

Basic break-even analysis typically assumes that
◦ 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.
◦ variable costs and revenues increase in direct proportion to the volume of production.
◦ both costs and revenues are made up of fixed and variable portions.
◦ revenues increase in direct proportion to the volume of production, while costs increase at a decreasing rate as production volume increases.
◦ All of the above are assumptions in the basic break-even model.


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Marked as best answer by berenicecastro on Dec 3, 2019

fwbard

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berenicecastro

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Reply 2 on: Dec 3, 2019
:D TYSM


chereeb

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Reply 3 on: Yesterday
Great answer, keep it coming :)

 

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