ECON FORMULAS

Total revenue

Price x quanity sold

Average rev

1. Average Revenue (AR) = TR ÷ Quantity
   
   

Marginal revenue

1. Marginal Revenue (MR) = Change in TR ÷ Change in Quantity
   
   

Total costs

Total Costs (TC) = Fixed Costs + Variable Costs

Average cost

1. Average Cost (AC) = TC ÷ Quantity
   
   

Marginal costs

Marginal Cost (MC) = Change in TC ÷ Change in Quantity

Profit

TR- TC

Sale volume

Sales Volume = Revenue ÷ Price

Market share

Market Share = (Firm’s sales ÷ Total market sales) × 100%

Contribution per unit

Contribution per unit = Selling price − Variable cost 

Break even output

Break-even output = Fixed Costs ÷ Contribution per unit

Break even point

1. TFC + TVC= TR

Margin of safety

Margin of safety= actual ouput- break even output 

PED

Price Elasticity of Demand (PED) = % ∆ Quantity Demanded ÷ % ∆ Price 

YED

Income Elasticity of Demand (YED) = % ∆ Quantity Demanded ÷ % ∆ Income

XED

Cross‑Price Elasticity (XED) = % ∆ Quantity A ÷ % ∆ Price B

PES

Price Elasticity of Supply (PES) = % ∆ Quantity Supplied ÷ % ∆ Price

Labour productivity

Labour Productivity = Total Output ÷ Number of Workers

% change

% Change = (New Value − Original) ÷ Original × 100%

Index number

Index Number = (Value in Year X ÷ Value in Base Year) × 100

GDP/ AD

C+ I + G + (X-M)

Multiplier

1. Multiplier = 1 ÷ (1 − MPC) or 1 ÷ (MPS + MPT + MPM)
   
   

Budget deficit

Budget Deficit = Government Spending − Tax Revenue

Current account balance

Current Account Balance = Trade + Services + Unilateral Transfers 

Gross profit margin

Gross Profit Margin = (Gross Profit ÷ Revenue) × 100

Operating profit margin

Operating Profit Margin = (Operating Profit ÷ Revenue) × 100

Net profit margin

1. Net Profit Margin = (Net Profit ÷ Revenue) × 100

Gross profit

1. gross profit= sales revenue- cost of sales

Operating profit

operating profit= gross profit- expenses

Net profit/ profit for the year

1. net profit/ profit for the year= operating profit- interest and tax- exceptional items

Net cash flow

Net cash flow= cash inflows- outflows

Closing balance

closing balance = opening balance + net cash flow

Market share

Business A sales/ market sales x 100