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Total revenue minus total cost is equal toGroup of answer choicesthe rate of return.marginal revenue.profit.net cost.

Question

Total revenue minus total cost is equal to

  • the rate of return.
  • marginal revenue.
  • profit.
  • net cost.
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Solution

To determine what "total revenue minus total cost" is equal to, let's analyze the terms involved:

  1. Total Revenue (TR): This is the total amount of money generated from sales of goods or services. It is calculated as: TR=Price×Quantity \text{TR} = \text{Price} \times \text{Quantity}

  2. Total Cost (TC): This includes all the costs incurred by a business in the production of goods or services. It can encompass both fixed and variable costs.

  3. Profit: This is a financial metric that represents what remains after all costs have been subtracted from total revenue. The formula for profit (P) is: Profit=Total RevenueTotal CostorP=TRTC \text{Profit} = \text{Total Revenue} - \text{Total Cost} \quad \text{or} \quad P = TR - TC

Based on the analysis, the answer to the question "Total revenue minus total cost is equal to" is profit.

Final Answer

Total revenue minus total cost is equal to profit.

This problem has been solved

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