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Breakeven

Breakeven Definition

The breakeven point in economics is the point at which cost or expenses and income are equal - there is no net loss or gain, one has "broken even".

The point at which a firm or other economic entity breaks even is equal to its fixed costs divided by its contribution per unit output, which can be shown by the following formula:

           

            Breakeven Point = Fixed / Contribution per Unit Output

The break even point is also the point on a chart indicating the time when something has broken even, and is a general term for not having gained or lost something in a process.




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