The Break - Even Point and the Leverage Effect – Instruments for Assessing the Economic and Financial Risk

The Break - Even Point and the Leverage Effect – Instruments for Assessing the Economic and Financial Risk

The establishing by any company, depending on the domain of activity, of anminimumobjective to be attained, so that the business should become profitable, is the aim principle of thisarticle. In order to attain this goal, the assumed risk is considered, which implies the use of certainassessing inst...

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Bibliographic Details
Main Author: Nicoleta Constandache
Format: Article
Language:English
Published: Danubius University 2011-12-01
Series:Acta Universitatis Danubius: Oeconomica
Subjects:
decision
return
benefit
loss
financial forecasting
risk
Online Access:http://journals.univ-danubius.ro/index.php/oeconomica/article/view/1341/1177
Description
Summary:The establishing by any company, depending on the domain of activity, of anminimumobjective to be attained, so that the business should become profitable, is the aim principle of thisarticle. In order to attain this goal, the assumed risk is considered, which implies the use of certainassessing instruments, as the break-evenpoint and the leverage effect. This approach stands for asignificant step in making strategic decisions, being a way to evaluating company security in case inwhich market conditions become unfavourable.
ISSN:2065-0175
2067-340X

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