Break-even point
What Break-even point means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of Break-even point
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Reference: Pearson Edexcel
The exact level of output where a business neither makes a profit nor a loss, because total sales revenue is exactly equal to total costs.
The point at which all fixed costs are covered, after which every additional contribution becomes pure profit.
The level of output found by dividing total fixed costs by contribution per unit.
Topics that use Break-even point
- The relationship between revenue and costs (Pearson Edexcel A-Level)
Related terms
- Break-even analysis
- Break-even output
- Business viability
- Contribution per unit
- Economies of scale
- Financial risk
- Fixed costs
- Margin of safety
Using Break-even point in the exam
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