ECONOMICS
COMPETITION AND MARKET STRUCTURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The break-even point (BEP) is obtained when TR>TC
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True
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False
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Either A or B
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None of the above
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Explanation:
Detailed explanation-1: -The break-even point is the point at which total revenue is equal to total cost. At this point, the profit is zero. (A particular company neither makes nor loses money at this point).
Detailed explanation-2: -A company’s breakeven point is the point at which its sales exactly cover its expenses. Fixed Costs ÷ (Price-Variable Costs) = Breakeven Point in Units.
Detailed explanation-3: -Total profit at the break-even point is zero.
Detailed explanation-4: -The vertical distance between TR and TC measures the profit or loss associated with any specific level of output. To the left of Qa and to the right of Qb total costs exceed total revenues, and there are losses. So there are two break-even points.
There is 1 question to complete.