Fixed and variable costs
Fixed costs do not change with output; variable costs change as output changes.
CAIE IGCSE Business 0264 - Paper 2
4.4 Costs, scale of production and break-even analysis
Topical Past-Paper Questions
Why it’s here: Business costs, economies of scale, break-even charts and decision-making.
Key concepts to revise
The main ideas to know for 4.4 Costs, scale of production and break-even analysis.
Economies of scale
Average costs may fall as purchasing, technical and financial advantages grow.
Break-even
Break-even output is where total revenue equals total cost.
Margin of safety
Actual or forecast output above break-even shows the margin of safety.
Exam material
Past-paper questions
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