Is the daily profit (revenue+total cost) supposed to go down, even if the gallons sold per day...
Question:
Is the daily profit (revenue+total cost) supposed to go down, even if the gallons sold per day increases?
Profits
Profits in economics can be represented by the "pi" function. The profit earned by the firm depends on the revenue cost relationship. A firm will earn maximum profit when the difference between the revenue and cost is the greatest. This happens when the firm operates at the profit maximizing point. Economists have however claimed that in the case of perfect competition, the firms will be compelled to operate at break even in the long run.
Answer and Explanation: 1
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View this answerThe profit that a firm earns can be given by
$$TR/q- TC/q $$
Where TR is the total revenue, TC is the total profit and q is the quantity.
The...
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Demand in Economics | Definition & Examples
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Chapter 7 / Lesson 11
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Learn about the demand curve and how the law of demand works with examples. See the demand definition, diagrams, and explanations.
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