Break-Even Analysis
Technique determining minimum sales needed to cover all costs.
Formula
Break-Even Output = Fixed Costs ÷ Contribution per Unit
Real World
A student selling handmade candles at a school fair with £50 fixed costs and £2 contribution per candle must sell 25 candles before making any profit — this is her break-even point.
Exam Focus
Show your working in calculations; method marks are awarded even if the final answer is wrong.
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