Final answer:
Increasing the selling price per unit will positively affect the break-even point, requiring fewer units to be sold to cover fixed costs. However, this assumes demand remains stable and is not significantly affected by changes in price due to elasticity.
Step-by-step explanation:
If the selling price per unit can be increased, it will have a positive effect on the break-even point. The break-even point is when total costs equal total revenue, meaning no net profit or loss. When the unit selling price increases, assuming the costs remain the same, each unit sold contributes more to covering fixed costs, and therefore, fewer units are required to reach the break-even point. This can lead to an earlier break-even and potentially higher profits thereafter. However, it's important to keep in mind that if the price increase causes a significant reduction in the quantity demanded (due to price elasticity), the positive effect on the break-even point can be negated. Businesses typically want to set prices at a level where total revenue is maximized, which could be at or near a point where price elasticity equals 1.