Low-Cost
Operating with minimum costs; competing on price.
Formula
Profit Margin = (Revenue − Costs) ÷ Revenue × 100
Real World
Ryanair strips out every non-essential cost — passengers pay extra for bags, seats, and food — allowing base fares as low as £9.99 while still generating profit.
Exam Focus
Distinguish 'low-cost' (a strategy) from 'low price' (the outcome) — conflating the two is a common exam error.
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