Final answer:
The statement regarding sales mix in break-even analysis is false as sales mix variation can significantly affect the break-even point. Furthermore, in the goods market, buyers might pay above equilibrium price, and sellers may sell below it due to various market factors.
Step-by-step explanation:
False Assumption in Break-even Analysis
The assumption that the sales mix will not change when there are multiple products is indeed false. In break-even analysis, it is essential to consider that the proportion of each product sold (the sales mix) can vary, and this variation can significantly impact the overall break-even point. A consistent sales mix is an ideal but unrealistic condition in dynamic market conditions.
Sales Mix Importance
The sales mix is critical because each product will typically have a different contribution margin (the difference between the selling price and the variable cost per unit). This affects the calculation of the overall contribution margin, thus altering the break-even point. If the proportion of higher-margin products increases, the break-even point decreases, as the business would need to sell fewer units to cover its fixed costs.
Market Price Considerations
The statement that "In the goods market, no buyer would be willing to pay more than the equilibrium price" is incorrect. Buyers may be willing to pay a premium for various reasons such as product differentiation, brand loyalty, urgency of need, or perceived value. Similarly, sellers might accept a price lower than the equilibrium price under certain circumstances like excess supply, need for liquidity, or market entrance strategies.