Break-even is a point in a business venture when the profits are equal to the costs.
- Relatively simple concept and the formula can be understood and used by most entrpreneurs
- The information provided can be vital when taking a decision whether to go ahead by most entrepreneurs
- It is widely used to support applications from entrepreneurs for loans
- It can be quickly adapted to allow for many 'what if' situtations to be considered and compared. This reinforces the usefulness of the technique for decision-making.
- It assumes that all output produced is sold.
- It oversimplifies business situations
- Many firms sell more…