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When you calculate the unit costs of production, you are calculating the breakeven point, or minimum price, you must sell each unit at to make a profit. For example, say you produce 2,000 units costing 3 per unit that you resell at 5 per unit. Your profit is 5 minus 3, or 2 a unit. You net income is 2,000 units multiplied by 2, or 4,000.

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