What is it called when the total cost of a business is greater than its total income?
Answer and explanation
Correct answer: Loss
A business incurs a loss when its total expenses or costs are greater than its total income or revenue. The relationship can be shown as Loss = Total Cost − Total Revenue, when cost exceeds income. For example, if costs are ₹8,000 and income is ₹6,000, the loss is ₹2,000. Profit occurs in the opposite situation, while saving and investment describe different financial ideas.
Frequently asked questions
What is the correct answer to this question?
Loss
Why is this the correct answer?
A business incurs a loss when its total expenses or costs are greater than its total income or revenue. The relationship can be shown as Loss = Total Cost − Total Revenue, when cost exceeds income. For example, if costs are ₹8,000 and income is ₹6,000, the loss is ₹2,000. Profit occurs in the opposite situation, while saving and investment describe different financial ideas.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: Business, Trade and Commerce. Topic: Business Risk.
