WHAT IS A BUSINESS?: Profit

Price: the amount paid by a consumer to purchase one unit of a product.

Total revenue: the income received from an organisations activities

Total Revenue = price per unit x quantity sold

Therefore, an increasing price and an increasing sales volume will lead to an increased revenue for a business. 

The costs of a business are how much a business spends internally to continue running. Costs are therefore a major factor in determining the overall success of a business. Costs can be classified as fixed, variable or total.

Fixed costs: costs that don't vary directly with the output in the short run (e.g. rent and wages)

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