LO 3.1Define and explain contribution margin ratio.
LO 3.2In a cost-volume-profit analysis, explain what happens at the break-even point and why companies do not want to remain at the break-even point.
LO 3.3Explain how a manager can use CVP analysis to make decisions regarding changes in operations or pricing structure.
LO 3.3Explain how it is possible for costs to change without changing the break-even point.
LO 3.4Explain how break-even analysis for a multi-product company differs from a company selling a single product.
LO 3.5Define operating leverage and explain its importance to a company and how it relates to risk.