Question 1
1 markIn the provided break-even chart, what does point X represent?
IB Diploma Programme (DP) - SL & HL · Business management
5.5 Break-even analysis: Practice Questions
5 multiple-choice questions marked as you go, and 1 written questions with worked solutions. All on 5.5 Break-even analysis.
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Question 2
1 markWhat is calculated by subtracting the variable cost per unit from the selling price per unit?
Question 3
1 markWhat is the likely effect on a firm's break-even point if its rent (a fixed cost) increases, while the selling price and variable costs remain unchanged?
Question 4
1 markWhich of the following best defines the term contribution per unit?
Question 5
1 markA firm has a current level of output of \(500\) units and its break-even point is \(350\) units. What is its margin of safety in units?
Question 6
4 marksA software company develops an app. The fixed development and server costs are \$10,000 per year. The variable cost per download (processing fees) is \$1. The app is sold for \$5.
(a) Calculate the break-even quantity. [1]
(b) If the price is increased to \$6 and variable costs remain the same, calculate the new break-even quantity. [2]
(c) State the impact of the price increase on the break-even point. [1]
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