The concept of a contribution margin comes from the need for business managers to understand how profitable their businesses have become. For most managers, this is as simple as looking at something ...

Contribution margin is defined as sales revenue less any variable expenses. It is typically calculated for a one-year period. Contribution margin is the money that you use to pay fixed expenses, such ...

Learn how to calculate the variable cost ratio to balance production costs and revenues. Understand its role in optimizing profit margins and business decision-making.

With ever-increasing costs of farm inputs, it becomes more important to determine what inputs will be best to control weeds and other detriments to your crops. Although I am not an agronomist, one ...

Discover what a shutdown point is in economics—when companies decide it’s more practical to cease operations temporarily or permanently due to revenue not covering variable costs.

Tyson’s contribution margin was likely getting squeezed from both sides, hence the decision to close the Lexington plant.