2.2.2 Flashcards
What is sales volume?
The amount of sales expressed as a number of units sold
What is sales revenue?
The amount of sales expressed as the total sum of money spent by consumers
What is the formula for sales volume?
Sales revenue / selling price
Selling price x quantity sold is the formula to work out what?
Sales revenue
What is revenue?
The money coming in from the sale of goods and services
What is the formula to work out revenue?
Selling price x quantity sold
What is meant by ‘Fixed costs’?
Costs that stay the same regardless of output
How are fixed costs presented on a graph?
They are shown as a straight horizontal line
What are variable costs?
Costs that change in relation to the number of items produced
How are variable costs presented on a graph?
The line starts at zero and slopes upwards
What are total costs?
Fixed costs plus total variable costs
How are total costs represented on a graph?
They start at the fixed cost point on the y axis and slope upwards
What is the formula for total costs?
TC= FC+ TVC
fixed costs + total variable costs
