Economic theory, applications issues - agecon search, C a $ e d 0 f total cost total revenue xb x volume of sales (equals output) of a firm per-unit of time figure 1: diagram typically used to illustrate break-even. Circular . -94 revised | white house, Note: the discount factor is calculated as 1/(1 + i) t where i is the interest rate (.07) and t is the year. the sum of column (5) is the total present value of costs. Chapter 24: inventory management: economic order quantity, Chapter 21 inventory management: economic safety stock is simply the difference the demand can be as much as 9,000 units per year above the expected.