The break-even point is the point at which total revenue is equal to total cost.

An increase in fixed costs will result in a higher break-even output.

The break-even output is calculated by dividing fixed costs by the contribution per unit.

Calculating the break-even point involves finding the level of output where total revenue equals total costs, indicating a point where the business neither makes a profit nor incurs a loss.

Total contribution is calculated by multiplying the contribution per unit by the quantity of output sold, showing the total amount that all units sold contribute towards covering fixed costs and potential profits.

The contribution per unit is determined by subtracting the variable cost per unit from the selling price, representing how much each unit sold contributes towards covering fixed costs and potentially generating profit.