Examlex
Which of the following reactions is correctly balanced?
Cash Flows
The total amount of money being transferred in and out of a business, serving as a measure of its financial health.
Contribution Margin
The amount that one unit contributes to profit. It is defined as price minus marginal cost.
Fixed Costs
Expenses that do not change with the level of goods or services produced by a business, such as rent, salaries, or insurance premiums.
Break-Even Quantity
The amount you need to sell to at least break even (make zero profit). The formula (assuming that you can sell all you want at price and with constant marginal cost) is Q = F/(P - MC), where F is fixed costs, P is price, and MC is marginal cost.
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