Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 13 - Part V - The Costs of Production - Questions for Review: 1

Answer

Profit=Total Revenue-Total Cost

Work Step by Step

A firm's profit is defined as the difference between its total revenue and total costs. If the revenue is greater than the cost, the firm has positive profit. Similarly, if the costs are greater than the total revenue, the firm has negative profit (meaning they lose money).
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