Answer the following questions about break- even analysis: 1. Break- even is defined as the point at

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Answer the following questions about break- even analysis:
1. Break- even is defined as the point at which ______________ equals ______________.
2. The contribution margin is equal to ______________ minus ______________.
3. The Local Town Concert Band has fixed costs of $ 500 per concert and variable costs of $ 2.00 per per-son who attends the concert. If they raise their ticket price from $ 2.25 to $ 2.50, their breakeven level:
a. Increases
b. Decreases
c. Stays the same
4. The marginal contribution or contribution margin is the difference between ______________ and ______________.
5. The Campaign for Better Politicians expects to have $ 5,000 in fixed costs. If their fixed costs do not change but the amount of money each marcher raises through pledges (price/ unit) declines from $ 75 to $ 60 and their variable cost/ unit increases from $ 40 to $ 50, their break- even quantity will:
a. Increase
b. Decrease
c. Stay the same
6. If all other factors remain unchanged, an increase in the variable cost per unit of service will:
a. Reduce the break-even volume of service.
b. Reduce the contribution margin per unit of service.
c. Increase total fixed costs.
7. The difference between marginal revenue and marginal cost is called the ______________.
8. If an organization sells ten fewer tickets to its annual gala than are needed to break even, the gala will produce:
a. A loss or deficit
b. Break-even results
c. A profit or surplus

Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...
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