Contribution per unit
What Contribution per unit means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of Contribution per unit
Exam boards and our study guides word this term in slightly different ways. Learn the version your board uses.
Check what you remember
Read the wording for your board, then hide it and explain Contribution per unit in your own words. Rough notes are fine. This is a self-check, with no mark or grade.
Reference: Pearson Edexcel
A measure of how much each product sold contributes towards paying off a firm's fixed costs and subsequently generating profit, calculated as selling price per unit minus variable cost per unit.
The selling price minus variable costs, showing what each unit contributes towards fixed costs.
The difference between the selling price of a product and its variable cost per unit.
Topics that use Contribution per unit
- Business objectives and pricing decisions (Pearson Edexcel A-Level)
- The relationship between revenue and costs (Pearson Edexcel A-Level)
Related terms
- Average cost
- Break-even analysis
- Break-even output
- Break-even point
- Business viability
- Economies of scale
- Financial risk
- Fixed costs
Using Contribution per unit in the exam
Check the command word and mark scheme for your exact question. After comparing your explanation with the reference, use the term in an answer on the linked topic. This practice does not predict an exam mark.
Practise Economics B questions
Create a free account to answer exam-style questions on this topic and get feedback on your answers.
A week of Premium from your first lesson · Then the free plan continues · No card, no charge