Fixed Costs Hint - Break Even Analysis [Virtual Learning Arcade]
Hints on changing fixed costs | |
Advantages
| | If the fixed costs increase then the total costs would increase (total costs = total fixed costs plus total variable costs). The effect is illustrated in the diagram. The total cost curves shift up in a parallel direction. This causes the profits to fall for any given quantity and the break-even point to be at a higher output level.
INCREASE IN FIXED COSTS » INCREASE IN BREAK EVEN LEVEL OF OUTPUT
| |
Navigation
| |
Break even analysis home page
»»
Return to the question page
»»
| |
Submitted by bized on Wed, 14/03/2001 - 13:00