Essay: Breakeven Analysis-Bill French’s Argument

Sample Essay

French does not consider the three products produced by this firm individually but rather on averages proving that it will not be easy to calculate break even figures for each of the products individually. In fact, French argues “that there is only one breakeven point for the firm” and thus it is the only point to be hit whether considering each product individually or in group (Harvard Business School, 1987).

It is evident that the method used by French to calculate for the break even analysis does not allow for change in the product mix since he assumes that nothing will be altered. For instance, the price of product C is very low and therefore need to be included in the analysis that there are products which may change in prices but this is not the case with French.  Bill has also assumed expected union demands, taxes and dividends.

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