Discussion
A rise in selling price, other things equal, moves the break-even point
Answer: B
Correct answer: downward
A higher price raises the contribution per unit, so fewer units are needed to cover the fixed cost and the break-even quantity falls - the revenue line steepens and crosses the unchanged cost line sooner. The obvious caution is that this holds other things equal, and a price rise usually reduces the volume that can be sold.
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