3.3 Costs and Revenues Flashcards
1
Q
Fixed Costs
A
An expense related to production but does not change with level of output. This cost is paid irrespective of how much is or isn’t produced.
2
Q
Variable Costs
A
An expense related to production that varies with the level of output. This cost rises when production volume increases.
3
Q
Profit vs Revenue
A
Revenue = Total income created from goods and services
Profit = Total income when costs are deducted from the revenue
4
Q
Revenue Streams
A
The various sources that a business earns income from
5
Q
Total Costs
A
Total of fixed and variable costs
6
Q
Average Costs
A
The pre-unit cost of production, calculated by dividing total cost by total output
