Question

A breakeven point for a new venture can be described as ____. Group of answer choices the point at which the firm begins producing goods or services with greater contribution margin the point at which the firm begins to see positive cash flow the point at which the firm produces a profit that is "good enough" the point at which an entrepreneur gets revenge on his/her competitors the point at which revenue matches the combination of fixed and variable costs

Answer 1

The point at which revenue matches the combination of fixed and variable costs

Step-by-step explanation:

Revenue is the total receipts from sales. Cost is the total expenditure on sales.

Break Even point is the point at which firm is at 'no loss, no profit situation'. It is earning revenues just sufficient to cover various (fixed & variable costs) of the business.

Mathematically : It is a point where Total Profit = Total Revenue - Total Cost = 0. Hence implying TR = TC.

Graphically, it is the point at which TR, TC curves intersect. Before B.E.P ; TR < TC & firm incurs losses. At B.E.P ; TR = TC, no profit, no loss. After B.E.P ; TR > TC firm earns profit.