ECONOMICS

Detailed explanation-1: -As illustrated in the graph above, the point at which total fixed and variable costs are equal to total revenues is known as the break-even point. At the break-even point, a business does not make a profit or loss. Therefore, the break-even point is often referred to as the “no-profit” or “no-loss point.”

Detailed explanation-2: -The correct answer is ‘True. ‘ Break-even point is the point where revenues equal the total of all expenses including the cost of goods sold. If revenues minus all expenses (fixed and variable, and including cost of goods sold) equals zero, you are at the break-even point.

Detailed explanation-3: -The break-even point is the point at which total cost and total revenue are equal, meaning there is no loss or gain for your small business. In other words, you’ve reached the level of production at which the costs of production equals the revenues for a product.

Detailed explanation-4: -To determine the break-even point graphically, the total cost curve of a product over time is plotted in a diagram. On the x-axis (horizontal axis) you plot the sales volume (how many products are sold) and on the y-axis (vertical axis) you plot the total cost of producing a given quantity of product.

Detailed explanation-5: -Total profit at the break-even point is zero.