The break even point is the point at which income and expenses intersect.

Question

BlackTom AI · Accepted Answer

The provided statement is: 'The break even point is the point at which income and expenses intersect.'

To evaluate this, recall the definition of the break-even point in cost-volume-profit analysis: it is the level of sales at which total revenue equals total costs (both fixed and variable). At this point, there is neither profit nor loss—the net income is zero. The intersection of the revenue line and the cost line on a chart represents this condition, confirming that the break-even point occurs where income (revenue) and expenses (costs) are equal.

In this specific item, there are no answer choices listed to evaluate, and the answer field indicates 'True.' Given the standard definition, the statement is correct because the break-even point is indeed where revenue covers all costs, i.e., income equals expenses.

If some students confuse break-even with other concepts, they might think it’s about maximizing profit or about when profits start; however, those ideas relate to post-break-even performance (where revenue exceeds costs). The key is recognizing that break-even marks zero profit, achieved precisely at the revenue-cost intersection.

Note: The absence of answer_options means we cannot compare multiple statements here, but the core concept remains valid for the asserted statement.

BMA06E1_CPL - Business Math - CPL Part 2 - Online Exam

The break even point is the point at which income and expenses intersect.

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