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Glossary · Unit Economics

Unit Economics

Unit economics is the analysis of the revenue and costs associated with a single unit of a business — such as one customer or one transaction — to judge whether the model is profitable at the margin.

Sound unit economics means each additional unit contributes more revenue than its variable cost; weak unit economics means growth loses money faster.

For AI labor, expressing revenue and cost per outcome is the unit-economics view that reveals whether an agent is profitable to operate.

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Related terms
Contribution Margin
Contribution margin is the revenue from a product or unit minus its variable costs, showing how much each sale contribut…
Customer Acquisition Cost (CAC)
Customer acquisition cost (CAC) is the average total sales and marketing spend required to win one new customer.…
Lifetime Value (LTV)
Lifetime value (LTV) is the total net profit a business expects to earn from a customer over the entire span of the rela…
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