Asked by rufyjane stephen manuere on May 02, 2024

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​Which of the following will decrease the price needed to break even?

A) ​A decrease in overall fixed but avoidable costs
B) A decrease in the marginal costs
C) An increase in sunk costs
D) ​Both A&B

Marginal Costs

The amount spent on producing an extra unit of a product or service.

Fixed Costs

Costs that do not vary with the level of output or sales in the short term, such as rent or salaries.

Sunk Costs

Costs that have already been incurred and cannot be recovered or refunded, and thus should not factor into future decision-making processes.

  • Comprehend the principles of fixed, variable, and marginal costs within business activities.
  • Examine the effects of price fluctuations on the quantity needed to break even and on strategic business planning.
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SG
Spencer GaffneyMay 07, 2024
Final Answer :
D
Explanation :
A decrease in both overall fixed but avoidable costs and marginal costs would decrease the price needed to break even. Sunk costs are irrelevant to break-even analysis as they are costs that have already been incurred and cannot be recovered.