Which of the following formulas correctly measures the profit of a monopoly?
A)  = TR − TC
B)  = (P − ATC)Q
C)  = (P − AVC)Q
D)  = TR − TC and  = (P − ATC)Q

Question

Quizplus · Accepted Answer

Both formulas D mentions, $ \pi = TR - TC $ and $ \pi = (P - ATC) \times Q $, are correct for calculating the profit of a monopoly. The first formula represents profit as the difference between total revenue (TR) and total cost (TC), while the second formula calculates profit by multiplying the difference between price (P) and average total cost (ATC) by quantity (Q).

Which of the Following Formulas Correctly Measures the Profit of a Monopoly