Profit is
A)The difference between total cost and variable cost.
B)The difference between total revenue and total cost.
C)Earned at all points along the production function.
D)Possible only with technical efficiency.

Question

Quizplus · Accepted Answer

Profit is the difference between total revenue and total cost. This means that in order to make a profit, the revenue earned must be greater than the costs incurred in producing goods or providing services. Therefore, option B is the correct choice. Option A is incorrect because it only takes into account the difference between variable cost and total cost, not revenue. Option C is incorrect because profit is not earned at all points along the production function, but rather is calculated as the difference between revenue and cost. Option D is incorrect because technical efficiency refers to the level of output produced from a given level of input, and while it can contribute to profitability, it is not the only factor involved.

Profit Is