A(n) ____________________ Margin Is Calculated by Subtracting Variable Expenses from Sales

question 38

Short Answer

A(n) ____________________ margin is calculated by subtracting variable expenses from sales, and represents the amount of revenue that contributes to covering the fixed expenses of a company.

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Definitions:

Economies of Scale

Cost advantages reaped by companies when production becomes efficient, as the scale of the operant increases, typically leading to a lower cost per unit.

Short-Run Losses

Financial deficits experienced by a business or project within a brief period, often due to initial start-up costs or market fluctuations.

Average Variable Costs

Costs that vary with output level, calculated by dividing total variable costs by the quantity of output produced.

Operate

To function or work in a particular manner, often referring to businesses and machinery performing their intended duties.