Topic notes
Separate fixed and variable costs, revenue, contribution and break-even. Contribution per unit=selling price−variable cost. Break-even quantity=fixed costs÷contribution per unit, assuming stable prices and costs within the range.
Applied example
Fixed cost ₹12,000; selling price ₹80; variable cost ₹50. Contribution ₹30; break-even=12,000/30=400 units.
Case study and practice
- Identify the opportunity or business issue.
- Name one assumption and evidence that could test it.
- Recommend an action, explaining its expected value and one risk.
Revision
Use an example, define the business term and distinguish assumption from evidence. Project claims should be based on research and cited sources.