Suppose you were working for Richstone's bakery and calculating whether the bakery was making a profit, considering the recent increase in rent. You have data for price (P),MR, ATC, MC, AVC, at the quantity of 1,000 breads a day. The firm's total profit is calculated by
A) P - AVC
B) P - ATC
C) P - MC
D) (P - ATC)Q
E) TR - TVC

Question

Quizplus · Accepted Answer

Total profit for a firm is calculated by taking the difference between the price and the average total cost (ATC) per unit and then multiplying by the quantity (Q) of units sold. This is represented by the formula (P - ATC)Q.

Suppose You Were Working for Richstone's Bakery and Calculating Whether