ECONOMICS
PROFIT
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Total Revenue
|
|
|
Marginal Revenue
|
|
|
Marginal Cost
|
|
|
Total Units Produced
|
Detailed explanation-1: -Profit is the money left over after subtracting total costs (expenses) from the total amount of sales (revenue). If no money is left over and money is owed, that’s a loss.
Detailed explanation-2: -Calculating profits, with = (P – ATC) × Q, we find = (7.5 – 5.59) x 110 = $210. Calculating producer surplus, with PS = (P – AVC) × Q, we find = (7.5 – 4.23) x 110 = $360. Note that our AVC and ATC are always calculated from the quantity where MC = P, as this is the profit maximizing quantity.
Detailed explanation-3: -Profit is the total amount producers earn after subtracting the production costs. Revenue is the total amount producers earn after subtracting the production costs.
Detailed explanation-4: -3) The profit a business makes is equal to the revenue it takes in minus what it spends as costs. To obtain the profit function, subtract costs from revenue.
Detailed explanation-5: -Profit is revenue minus expenses.