ECONOMICS
PROFIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Yes, I understand this from the notes
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No, I don’t understand this from the notes
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No, I don’t understand this, as I have not read the notes
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None of the above
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Detailed explanation-1: -Profit is defined as the difference of total revenue (TR) over total cost (TC) of the firm. So profit = TR – TC. Economists often distinguish between super normal profit and normal profit. Super normal profit is defined as the surplus of total, revenue over total cost.
Detailed explanation-2: -Profit for a firm is total revenue minus total cost (TC), and profit per unit is simply price minus average cost. To calculate total revenue for a monopolist, find the quantity it produces, Q*m, go up to the demand curve, and then follow it out to its price, P*m. That rectangle is total revenue.
Detailed explanation-3: -Profit is the firm’s total revenue minus its total cost. A firm’s cost of production includes all the opportunity costs of making its output of goods and services. A firm’s cost of production include explicit costs and implicit costs.
Detailed explanation-4: -Economics. When a firm’s total revenue is greater than its total economic costs, the firm is earning an economic profit. When TR is greater than TC the firm earns an economic profit and when TC is greater than TR firm earns an economic loss.