Interesting facts you might not know!

First fact: Did you know that when you manufacture steel or any manufactured product, a production cost is deducted in gold?

((The cost of production here is 13 gold)

That means even if you are producing steel without producing raw materials yourself, just buying the raw materials from the market will automatically be counted as a cost.

Second fact: Since there is a cost for producing steel (which is buying iron), let me ask you a question… does iron have a production cost?

You might answer and say no, factories produce it completely for free.

That is a very correct answer and I can’t argue with it, but there is a case where raw material production has a cost (like hiring workers in your factory).

((The cost of production here is 44 gold; that's just the worker's salary.)

Workers have a cost (their salary), but the factory itself has no cost because its production is free, just like you said before.

Now let’s go back to steel. Since there are costs in producing steel, you must sell it at a certain price that covers the cost and gives you profit, or (focus on this point) at least covers the production cost, which is called the Break-even.

This is the break-even price. If you sell at this price, you have covered your production costs, meaning you didn’t gain or lose anything from this product. Anything above it is profit, and anything below it is a loss. So the break-even point is the balance that helps you determine the right selling price in the market.

Now let’s go back to iron. By nature, raw materials do not have production costs unless you hire workers in your company or factory. In that case, costs will be added and a break-even price will appear.

And as we said before, hiring workers is risky — it can either generate big profits or big losses. So you must know your costs, determine your break-even point, and try to sell above it to make profit.

I hope I brought you a useful new piece of information to help your economy.

Good luck champions.

Regards,

Abo_Ali