The breakeven point in economics is the point where total costs and total revenue become equal, resulting in a net income or profit of zero. It occurs when the number of units sold or produced exactly covers all the costs associated with making those items. In other words, the break-even point is the level of activity at which a business neither earns a profit nor incurs a loss. Knowing and understanding your company’s breakeven point helps you better manage its financial performance and determine the best pricing structure for your products or services.