Revenue, Cost, Profit and Interest

• Revenue - income businesses make by selling products
• Revenue = quantity sold x price
• Fixed costs - costs that don't change with output e.g rent, wages
• Variable costs - costs that increase as output increases e.g.raw material and electricity
• Total variable costs = quantity sold x variable cost per unit
• Total costs = fixed costs + variable costs
• Profit - the difference between revenue and costs over a period of time
• Profit = revenue - costs
• Interest - the cost of borrowing money or reward for saving
• Interest = difference / original x 100