- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 1. The Firm and Market Structures
- Subject 4. Breakeven Analysis and Shutdown Decision
CFA Practice Question
The breakeven point is the minimum average ______ cost point in the long run.
B. fixed
C. total
A. variable
B. fixed
C. total
Correct Answer: C
The breakeven point occurs when total revenue (TR) equals total cost (TC), otherwise stated as the output quantity at which average total cost (ATC) equals price. In the long run it is the minimum average total cost point.
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