ECONOMICS

Detailed explanation-1: -Economics. When a firm’s total revenue is greater than its total economic costs, the firm is earning an economic profit.

Detailed explanation-2: -The break-even point is the point at which total cost and total revenue are equal, meaning there is no loss or gain for your small business. In other words, you’ve reached the level of production at which the costs of production equals the revenues for a product.

Detailed explanation-3: -If the firm is operating at a level of output where the market price is at a level higher than the zero-profit point, then price will be greater than average cost and the firm is earning profits. If the price is exactly at the zero-profit point, then the firm is making zero profits.

Detailed explanation-4: -Gross profits is the difference between total revenue and total cost.