If a firm is earning a profit,then:

Question

Quizplus · Accepted Answer

If a firm is earning a profit, it means that its total revenue is higher than its total cost. This is because profit is the difference between total revenue and total cost. ATC or AR/MR may or may not be higher than the market price, but what matters is that the firm is earning more revenue than what it costs to produce the goods or services, resulting in a profit. MR being equal to MC is a condition for profit maximization, but it does not necessarily mean that the firm is already earning a profit.

If a Firm Is Earning a Profit,then