1.3.2 Business Revenue, costs and Profit Flashcards
1
Q
Fixed costs:
A
costs that don’t vary just because output varies, for example rent.
2
Q
Interest
A
the charges made by banks for the cash they have lent to a business, for example six per cent per year.
3
Q
profit
A
the difference between revenue and total costs; if the figure is negative the business is making a loss.
4
Q
Revenue
A
the total value of the sales made within a set period of time, such as a month.
5
Q
Total costs
A
all the costs for a set period of time, such as a month.
6
Q
variable costs
A
costs that vary as output varies, such as raw materials.
7
Q
sales revenue
A
Sales revenue = price × quantity sold
8
Q
total cost
A
Total costs = variable costs + fixed costs
9
Q
profit
A
Profit = total revenue – total costs
