Return on Investment (ROI)shows How Many Units Must Be Sold

question 70

True/False

Return on investment (ROI)shows how many units must be sold monthly to offset the monthly fixed costs and average per-unit variable costs.

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Definitions:

Total Costs

The aggregate amount of spending involved in generating goods or services, factoring in both stable and changeable costs.

Variable Costs

Variable costs are expenses that vary directly with the level of production or sales volume, such as materials and labor.

ATC Curve

Represents the average total cost of production, calculated by dividing the total cost by the quantity of output produced, depicted graphically.

Marginal Cost

The additional cost incurred by producing one more unit of a product or service; it is an important concept in economics for understanding how to optimize production levels.