The Sum of Internal and External Costs Is

question 125

Multiple Choice

The sum of internal and external costs is

• A) private costs.
• B) social costs.
• C) internality.
• D) common property.

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Definitions:

Contribution Margin

Contribution margin is the revenue remaining after subtracting variable costs, used to cover fixed costs and generate profit, highlighting the profitability of individual products.

Business Segments

Parts or divisions of a company that operate within distinct markets or industries, often reported separately in financial statements for analysis.

Common Fixed Expenses

Overhead costs that are incurred regardless of the level of production or sales, shared by multiple products or departments.

Common Fixed Expenses

Fixed costs shared across different departments or product lines, such as rent or administrative salaries, not directly tied to any one aspect of business operations.