Which point of production is when total costs equal total revenue?

The correct answer is the break-even point. This is the level of production at which total costs incurred by a business equal the total revenue generated from sales. At this point, the business is not making a profit, but it is also not incurring any losses. Understanding the break-even point is crucial for businesses because it helps them determine the minimum sales needed to cover all expenses.

When a company reaches the break-even point, it indicates that the operations are sustainable in terms of covering costs, and any output beyond this point contributes to profit. This concept is fundamental in economics and financial management, as it assists businesses in making informed decisions about pricing, costs, and production levels.

Other options relate to different financial situations. For instance, the profit point refers to levels of production where revenue exceeds costs, while the loss point indicates when costs exceed revenue. The maximum output point is concerned with production capacity rather than financial balance.