Unit 1 Equations

Question 1

Profit

Answer 1

Total revenue - total costs

Question 2

Sales revenue

Answer 2

Quantity sold x selling price

Question 3

Total costs

Answer 3

Fixed costs + variable costs

Question 4

Break even

Answer 4

Fixed costs / (selling price per unit - variable costs per unit)

Question 5

contribution

Answer 5

selling price - variable costs

Question 6

margin of safety

Answer 6

selected level of business activity - break even output

Question 7

% change

Answer 7

( difference / original ) x100

Question 8

income elasticity of demand

Answer 8

% change in quantity / % change in income

Question 9

price elasticity of demand

Answer 9

% change in quantity / % change in price