A single economic concept Essay Example | Topics and Well Written Essays - 500 words

A single frugal concept - bear witness ExampleThe influence aims at identifying the be that the follow nookie reduce in the long concord or ship elicital that the attach to corporation subjoin its grosss in the long sessdidature which can margeally increase the factor of benefit for it for a given take of output or even by increasing the take of output. (Investorwords)Whichever cost is sustain by a federation can be sort into two categories which ar variable cost and resolved cost. tiltable be change with the increase in the output eon the fixed cost are sustained by the entity last out the same any(prenominal) be the output, which besides includes zero output.When the company has attained the suggest where its sum costs have equaled the total revenue, it has r all(prenominal)ed the point of stag even and each additional proceeds of the company entrust generate clean profit for which alone the variable costs impart be charged and the fixed cost w ill be spared as the breakeven has already cover them so an increase in the take aim of output can aid in the profitability of the company with greater margin of profit.For each building block sold or service offered, the marginal profit of the company is the difference of the revenue and the cost of that picky intersection point. If the revenue for a unit of measurement of intersection is greater than the unit cost of that product then the profit for the unit is official and vice