To determine the break-even point, a firm first needs to calculate the contribution per unit. What does this mean?
What will be an ideal response?
The contribution per unit is the difference between the price the firm charges for a product and the variable costs. This figure is the amount the firm has after paying for fixed costs of production.
You might also like to view...
Answer the following statements true (T) or false (F)
1. Placement describes where a product or service gets located in the marketplace. 2. According to the mutuality principle, marketers are obligated to sell products for the lowest price possible. 3. In the Robin Hood Effect, managers offer something extra to wronged employees. 4. All managers carry out some human resource functions. 5. Interactional justice is particularly important when selecting employees.
Risk management is a:
A) Three-stage process. B) Four-stage process. C) Five-stage process. D) Six-stage process.
Which of the following statements is CORRECT?
A. The preferred stock of a given firm is generally less risky to investors than the same firm's common stock. B. Corporations cannot buy the preferred stocks of other corporations. C. Preferred dividends are not generally cumulative. D. A big advantage of preferred stock is that dividends on preferred stocks are tax deductible by the issuing corporation. E. Preferred stockholders have a priority over bondholders in the event of bankruptcy to the income, but not to the proceeds in a liquidation.
The major contribution of the Miller model is that it demonstrates that
A. personal taxes decrease the value of using corporate debt. B. financial distress and agency costs reduce the value of using corporate debt. C. equity costs increase with financial leverage. D. debt costs increase with financial leverage. E. personal taxes increase the value of using corporate debt.