Break Even Analysis

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Break-even analysis is a financial tool that helps businesses determine the point at which they neither make a profit nor incur a loss. It is a valuable technique for assessing the viability and profitability of a product, service, or entire business venture. In this note, we will explore break-even analysis, its components, and its significance.

Break-even analysis involves analyzing the relationship between revenue, costs, and profit. It helps determine the number of units a business needs to sell or the amount of revenue it must generate to cover its costs. At the break-even point, total revenue equals total costs, resulting in zero profit. This point acts as a threshold beyond which the business starts generating profits.

To perform a break-even analysis, several key components must be considered. The first component is fixed costs, which are expenses that remain constant regardless of the level of production or sales. Examples include rent, utilities, _____ __________ _______ ____ __________ __ ____.
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Degree : PG DIPLOMA PROGRAMMES
Course Name : POST GRADUATE DIPLOMA IN COMPUTER APPLICATIONS
Course Code : PGDCA_NEW
Subject Name : Database Management Systems
Subject Code : MCS 207
Year : 2022 2023