Profit as Revenue Minus Total Cost
A firm's economic profit is calculated as the difference between its total revenue and its total costs. Total revenue is determined by multiplying the price (P) of the product by the quantity (Q) sold, while total costs, denoted as C(Q), are a function of the quantity produced.
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The Economy 2.0 Microeconomics @ CORE Econ
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Quantity (Q) Price per Bowl (P) Total Cost (TC) 5 $50 $150 10 $45 $250 15 $40 $375 20 $35 $550 A company that manufactures custom phone cases is currently producing and selling 20 cases per day. The company is considering increasing its daily production to 30 cases. Using the demand and cost information provided in the table below, determine the effect this change in output would have on the company's daily profit.
Quantity (Q) Price per Case (P) Total Cost (TC) 10 $25 $180 20 $22 $280 30 $19 $350 40 $16 $450 Profit as Revenue Minus Total Cost
Figure 7.17: Profit Maximization for Beautiful Cars using Marginal Revenue and Marginal Cost Curves
Learn After
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Marginal Profit (MR - MC)