Given that TC = TFC + TVC and TR = AR x Q, profit is equal to
Question 1 Report
Given that TC = TFC + TVC and TR = AR x Q, profit is equal to
Answer Details
Profit can be defined as the difference between total revenue (TR) and total cost (TC). Using the given formulas, we can express profit as:
Profit = TR - TC
Substituting TR = AR x Q and TC = TFC + TVC, we get:
Profit = AR x Q - TFC - TVC
Therefore, the answer is: (AR x Q) - TC.
Note that (AR + Q) - TFC and (TC x Q)/AR are not equivalent to the formula for profit, and (TFC + TVC)/Q is equivalent to the formula for average variable cost (AVC), not profit.
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