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# Mgt 201 GDB no 2 closing date Friday, July 31, 2015

Learning Objective

Improve conceptual understanding of Break-even point.

Question

In a competitive environment, where a producer cannot increase selling price of a product, how can he break-even the business operations? Give suggestions.

Important Instructions

ü  Answer must be given in bulleted form only.

ü  Answer must NOT exceed 100 words.

ü  Obnoxious or ignoble answer should be strictly avoided.

ü  Questions/queries related to the content of the GDB, which may be posted by the students on MDB or via e-mail, will not be replied till the due date of GDB is over.

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### Replies to This Discussion

question ko smjhu easy hai ,

is ka mtlab hai , agr itny sary competiter hn to , 1 producer apny product ki price to increase nhi kr skta , woh kesy apni asal rakam hasil kry , jo product ki actual cost  hai , km sy km woh to mil jaey , profit na ho  lkn loss bhi na ho , is k liye woh kia kry , koi suggesstion do , apni hi example ly lo , aur sochu suggest kro.

2. storage cost.

3. lowering labor.

Just points batane hn ke details b deni hn ???? Rai Irfan

Break-even is the point of zero loss or profit. At break-even point, the revenues of the business are equal its total costs and itscontribution margin equals its total fixed costs. Break-even point can be calculated by equation method, contribution method or graphical method. The equation method is based on the cost volume profit ( cvp) formula:-

px=vx + FC + profit

* Where,

* p is the price per unit,

* x is the number of units,

* v is variable cost per unit and

* FC is total fixed cost.

Socially undesirable aspects compared to perfect competition

* Selling costs: Products under monopolistic competition are spending huge amounts on advertising and publicity. Much of this expenditure is wasteful from the social point of view. The producer can reduce the price of the product instead of spending on publicity.

* Excess Capacity: Under Imperfect competition, the installed capacity of every firm is large, but not fully utilized. Total output is, therefore, less than the output which is socially desirable. Since production capacity is not fully utilized, the resources lie idle. Therefore, the production under monopolistic competition is below the full capacity level.

* Unemployment: Idle capacity under monopolistic competition expenditure leads to unemployment. In particular, unemployment of workers leads to poverty and misery in the society. If idle capacity is fully used, the problem of unemployment can be solved to some extent.

* Cross Transport: Under monopolistic competition expenditure is incurred on cross transportation. If the goods are sold locally, wasteful expenditure on cross transport could be avoided.

* Lack of Specialization: Under monopolistic competition, there is little scope for specialization or standardization. Productdifferentiation practiced under this competition leads to wasteful expenditure. It is argued that instead of producing too many similar products, only a few standardized products may be produced. This would ensure better allocation of resources and would promote economic welfare of the society.

* Inefficiency: Under perfect competition, an inefficient firm is thrown out of the industry. But under monopolistic competition inefficient firms continue to survive.

aray koi tu serious answer post karo....

These points can break-even the business operations.

• Gross profit margin
• Operating expenses
• Annual debt service
• Cost control
• Value Analysis
• Just in time approach
• Standard costing
• Total quality control
• Economic order quantity
• Market research
• Benchmarking
• Inventory management
• Work study
• Material handling
• Variety reduction
• Design

Plz koi to de do

In a competitive environment, where a producer cannot increase selling price of a product, he has to keep the price same, not decrease like compititors, he has to switch on his price and production and have fully trust on his production ,If we have trust on our production , then we can win the business market .
Moreover at the edge of for break-even producer has to dropping the storage cost, he has to sinking the labour. Break-even is based on categorizing construction costs between those which are "flexible" and fixed cost. The business has not made profit or loss, but have recovered all the expenses. Complete variable and fixed costs are connected with sales revenue in order to control the level of sales volume, sales value or production at which the business makes neither a profit nor a loss. Cost volume profit formula PX=vx + FC + profit this is the formula which we can compute break even.

changing kr len a , synonyme etc aur khud sy bhi 1 2 line lazmi add kro do , jo ap sugest krna chahty ho apny words men .

ye bulet form men hai

• In a competitive environment, where a producer cannot increase selling price of a product, he has to keep the price same, not less like others, he has to stick on his price and production and have fully trust on his production ,If we have trust on our production , then we can win the business market .
• Moreover at the edge of for break-even producer has to dropping the storage cost, he has to sinking the labour.

• Break-even is based on categorizing construction costs between those which are "flexible" and fixed cost.
• Complete variable and fixed costs are connected with sales revenue in order to control the level of sales volume, sales value or production at which the business makes neither a profit nor a loss.
• Cost volume profit formula px=vx + FC + profit this is the formula which we can compute break even ,
• The business has not made profit or loss, but have recovered all the expenses.

ab easily koi 1 2 line apni traf sy add kr len achy no aa jaen ge ,

kon sa solution best ha bata do plz

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