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Break-even analysis aids decision-making by determining the point at which total revenues equal total costs, allowing businesses to understand the minimum sales needed to avoid losses. This analysis helps managers assess the viability of new products, pricing strategies, and cost structures, facilitating informed financial planning. By visualizing profit and loss scenarios, it enables strategic decisions on scaling operations or reallocating resources effectively. Ultimately, it provides a clear framework for evaluating the financial implications of various business choices.

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