Economics B A-Level
Margin of safety
What Margin of safety means in Economics B A-Level, as defined for Pearson Edexcel.
Definition of Margin of safety
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Reference: Pearson Edexcel
The difference between a business's current or expected sales volume and its break-even output, measuring how much sales can fall before the business begins to incur a loss.
Topics that use Margin of safety
- The relationship between revenue and costs (Pearson Edexcel A-Level)
Related terms
- Break-even analysis
- Break-even output
- Break-even point
- Business viability
- Contribution per unit
- Economies of scale
- Financial risk
- Fixed costs
Using Margin of safety in the exam
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