Where total revenue equals total costs
Where total revenue equals total fixed cost
Where total revenue equals total variable cost
Where total revenue exceeds the total costs
Answer is Right!
Answer is Wrong!
The correct answer is: A. Where total revenue equals total costs.
The break-even point is the point at which a company’s total revenue equals its total costs. At this point, the company is neither making nor losing money.
Option B is incorrect because total fixed costs are the costs that do not change with the level of production. These costs include rent, insurance, and depreciation.
Option C is incorrect because total variable costs are the costs that change with the level of production. These costs include the cost of materials and labor.
Option D is incorrect because total revenue exceeds the total costs when the company is making a profit.