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Unit economics

Definition

Unit economics is the measurement of a company's revenue and costs on a per-unit basis. It helps to determine whether or not the company is making a profit from each product or service sold. Unit economics can be used for both physical products and digital goods.

  • Revenue per unit (RPU)
  • Cost of goods sold per unit (COGS)
  • Gross profit margin per unit (GP%)
  • Operating expenses per unit (OPEX)

Unit economics are also important for investors looking at companies' overall financial performance. If a company is making more money from each unit sold than it is spending on producing those units—and if that margin keeps increasing over time—then its overall profitability will likely keep increasing as well

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