It is cheap to carry out and it can show the profits/losses at varying levels of output. It also provides a simple picture of a business - a new business will often have to present a break-even analysis to its bank in order to get a loan.
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The break- even analysis identifies the break-even point, which is the level of sales and expenses, including loan principal payments, at which a business has no profit and no loss.
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The production cost is the cost to produce the product. The break even analysis is the amount you would have to sell the product for to simple break even on your cost-not to make a profit or lose money.
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Original answer: Break-even = fixed cost/ (price - variable cost)Additional: This equation gives the answer as the number of units of the product.