Basic break-even and CVP models are subject to limiting assumptions?

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1068487

2026-02-20 08:00

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Yes, basic break-even and cost-volume-profit (CVP) models assume a constant sales price, fixed costs, and linear relationships between costs, volume, and profits. They also do not account for factors like seasonality, changes in pricing strategies, or complexities in cost structures, leading to limitations in their application to real-world scenariOS.

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