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A method to determine the point at which total costs equal total revenue is to calculate the break-even point. This is done by using the formula: Break-even Point (in units) = Fixed Costs / (Selling Price per Unit - Variable Cost per Unit). At this point, the revenue generated from sales will cover all fixed and variable costs, resulting in neither profit nor loss. Analyzing this helps businesses understand the minimum sales needed to avoid losses.
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Profits will be maximized when marginal revenue?
Profits will be maximized when marginal revenue is equal to marginal costs. This will only happen in cases where there are fixed costs.
A producers profits are maximized when marginal costs are?
equal to marginal revenue
How can one determine the method for finding marginal revenue in a perfectly competitive market?
To determine the method for finding marginal revenue in a perfectly competitive market, one can calculate the change in total revenue when one additional unit of output is sold. This can be done by taking the derivative of the total revenue function with respect to quantity. In a perfectly competitive market, marginal revenue is equal to the market price.
Why total revenue equal to total cost?
No total revenue is total finance in, you need to take from this the running costs of the business to get the gross profit (net sales minus the cost of goods and services sold).
An example of a case where a cost and a revenue function do not have a break-even point.?
A break-even point occurs where total costs equal total revenues. An example where this does not happen is if a company's fixed costs are excessively high compared to its revenue potential, such as a luxury yacht manufacturer producing only a few units per year. If the revenue generated from sales never reaches the high fixed costs, the cost and revenue functions will not intersect, resulting in no break-even point.
Profits will be maximized when marginal revenue?
Profits will be maximized when marginal revenue is equal to marginal costs. This will only happen in cases where there are fixed costs.
A producers profits are maximized when marginal costs are .?
equal to marginal revenue
A producers profits are maximized when marginal costs are?
equal to marginal revenue
What is the total revenue at break even point if Ace corporation's variable costs are equal to 43 percent of sales revenue and their fixed costs per month are 600000?
Revenue at BREAK EVEN point is $0.00
Is a company earnings are the same as its revenue?
A company's earnings are equal to revenue less costs of production over a given period of time.
How do you determine the optimal level of advertising?
the optimal level of advertising expenditure for the firm is determined where the marginal revenue increase in costs of advertising are equal to the marginal increase in revenue
Is net earnings equal to net income?
I believe so. Net Income is equal to the income that a firm has after subtracting costs and expenses from the total revenue.
Why are profit maximize when marginal revenue is equal to marginal cost?
Profits are maximized when marginal costs equals marginal revenue because fixed costs are now spread over a larger amount of revenue. This means that total cost per unit declines and profits increase. Another way to say this is that this is the effect of scale. When marginal revenue equals marginal costs, in a growing revenue situation, you gain economies of scale and higher profits.
Does contribution margin equal Sales-variable costs?
Contribution margin is computed as sales revenue minus variable expenses
How can one determine the method for finding marginal revenue in a perfectly competitive market?
To determine the method for finding marginal revenue in a perfectly competitive market, one can calculate the change in total revenue when one additional unit of output is sold. This can be done by taking the derivative of the total revenue function with respect to quantity. In a perfectly competitive market, marginal revenue is equal to the market price.
What is a BEP?
A BEP is a break-even point, the point at which total costs equal total revenue and the organization neither makes a profit or a loss.
Why total revenue equal to total cost?
No total revenue is total finance in, you need to take from this the running costs of the business to get the gross profit (net sales minus the cost of goods and services sold).
