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Calculating the Break-Even Point

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In very general terms, how do we calculate breakeven?

How do we have to adjust our approach to accommodate breakeven for a firm selling multiple products?

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Solution Summary

A general, high-level overview of determing the break-even point based on cost and revenue functions

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In very general terms, breakeven is the point at which Revenue is equal to Cost. While Revenue is less than Cost, we are losing money operating and on our way to going out of business. When Revenue exceeds Cost, we have profit. At the point both functions are equal, we have an breakeven point. (Note I said "an breakeven", not "the ...

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