The world of microeconomics and business decision-making hinges upon a key concept: marginal cost. In the simplest terms, marginal cost represents the expense incurred to produce an additional unit of ...

Learn how to calculate the variable cost ratio to balance production costs and revenues. Understand its role in optimizing profit margins and business decision-making.

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Charlene Rhinehart is a CPA , CFE, chair of ...

You can categorize your business costs as fixed, variable and mixed based on how they change in response to your sales or production output. Fixed costs remain the same no matter how many units you ...

Costs are a critical variable to consider when plotting business strategy. After all, if you can't recover the expenses required to create your product through revenue and profit, then the business ...

Every business has operating expenses — that is, the costs of running the business. These expenses can generally be classified in two ways: Fixed expenses and variable expenses. Understanding the ...