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When You Produce Cars, It Is Enormously Expensive to Produce

question 64

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When you produce cars, it is enormously expensive to produce one car, but ultimately the costs per car decrease as more are produced. This would be an example of:


Definitions:

Operating Income

Earnings before interest and taxes (EBIT), representing a company's profit from regular operations, excluding non-operational income and expenses.

Retained Earnings

Profits that a company has earned to date, less any dividends or other distributions paid to shareholders.

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue, indicating the company's bottom line.

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