Principles of Microeconomics / Unit 7 MIC 0612 short lesson, about 20 seconds
The Break-Even Point
Captions available
The idea
The break-even point is the lowest point of average total cost, where marginal cost crosses it. At that price the firm earns zero economic profit: a normal profit.
In practice
For the farm, about twenty-five dollars at seven flats.
Where people slip
Break-even is not where revenue first covers cost on the totals table; it is the price at which the best quantity earns zero.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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