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You can explain in your way .... :-)
'BREAKEVEN PRICE'
1. The amount of money for which an asset must be sold to cover the costs of acquiring and owning it.
2. The amount of money for which a product or service must be sold to cover the costs of manufacturing or providing it.
3. In options trading, the stock price at which investors can choose to exercise without incurring a loss
Beak Even Point can be defined as a point where the total cost and total sales are equal, a point where there is no net profit no net loss. It is the first major step towards Profitability, a company should at least reach this point in order to continue with its business, below this point it will not be feasible for them.
it is defined as the point in which there is no loss and no profit ,and its usage is when the company new launched are there is a boosting competition.
Break even price is the price at which company's need to sell a particular product in certain quantity so that there is no profit/loss.
For example: We intend to sell stationery say pencil and cost of manufacturing it and distributing it is2AED/pencil. Now the company has produced100 pencils and according to analysis they believe they would be able to sell a maximum of80 pencils. Now since cost of manufacturing and distributing( i.e. fixed costs+variable costs) those pencil is200AED(2*100) and they intend to sell80 pencils, now they have to charge2.5AED/pencil(200/80) to achieve break even point(i.e. no loss or profit) and the price at which it is being sold is called break even price. In this case it is2.5AED
It is a price where suppliers are at a position of no profit and no loss condition. it is a common method of CVP [Cost, volume, profit analysis]
In economics, the break-even point is the point at which revenues equal expenses. In investing, the break-even point is the point at which gains equal losses.
It's a figure which sadly too many organizations do not know and may be used as marketing, pricing points to push opportunities and close sales.
Breakeven price is the amount of money for which an asset must be sold to cover the costs of acquiring and owning it ( to be flat)
It means revenue and expense are equel
Break even price is the lowest acceptable price point below which the seller will start losing money.
The point where total cost & total sales are equal, where there is no profit or loss is the Break even Point
Simply the point at which you have not made a loss and neither did you make a profit on a particular good. in other words you have gained back the cost of the product or service rather than made a loss or profit.
