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GCSE Business · key term
The level of sales at which total revenue equals total costs, so a business makes neither a profit nor a loss.
Used by OCR
Paper 2
Revise: Purpose of the Finance FunctionBreak-even calculations show the sales needed to cover total costs.
The point at which a business’s total revenue equals its total costs, so it makes neither a profit nor a loss.
Define break-even using total revenue and total costs, not just fixed costs.
At break-even, profit is zero. The business has made sales, but all its revenue is needed to cover its costs.
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