$"$CVP analysis is both simple and simplistic. If you want realistic analysis to underpin your$$ decisions, look beyond CVP$$ analysis." Do you$$ agree? Explain.

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Part $1$

A$.$

CVP analysis is$$ simple, with its assumption of output as the only revenue and cost$$ driver, and linear revenue and cost relationships. It is not necessarily$$ simplistic, though, since the basic ideas can be expanded upon to provide useful insights in more complex$$ decision$-$making cases.

B$.$

CVP analysis is not simple or simplistic.$$ It's assumption of output as just one of many revenue and cost$$ drivers, and its$$ non$-$linear revenue and cost relationships creates a complexity which makes it very difficult to understand and useful only in very complex$$ decision$-$making cases.

C$.$

CVP analysis is$$ simple, with its assumption of output as the only revenue and cost$$ driver, and linear revenue and cost relationships. Because CVP analysis is so$$ simplistic, it provides very little value in more complex$$ decision$-$making cases.

D$.$

CVP analysis is$$ simple, with its assumption of fixed costs as the only revenue and cost$$ driver, and linear revenue and cost relationships. It is not necessarily$$ simplistic, though, since the basic ideas can be expanded upon to provide useful insights in more complex$$ decision$-$making cases.