Question 1

The contribution is the difference between total revenue and ___________________

Accepted Answer

The contribution is the difference between total revenue and variable cost. This is because contribution margin is used to cover fixed costs and to generate profit after those fixed costs are covered.

Question 2

The difference between break even sales and actual sales is known as _________________

Accepted Answer

The difference between break-even sales and actual sales is known as the margin of safety. It represents the amount by which sales can drop before the business starts incurring losses.

Question 3

Break - even point is the point where________________________

Accepted Answer

The break-even point is the point where Total Revenue (TR) equals Total Costs (TC), meaning there is no profit or loss.

Quiz 1: Economics: Concepts and Institutions

The contribution is the difference between total revenue and ___________________

The difference between break even sales and actual sales is known as _________________

Break - even point is the point where________________________