Use the following figure to answer the question : Figure 9-3 : shows the marginal cost curve,average total cost curve,average variable cost curve,and marginal revenue curve for a firm for different levels of output.
-Refer to Figure 9-3.At the output level OB,total profits equal the area given by _____.
A)FTDE
B)GMLR
C)FHSR
D)FBOR

Question

Use the following figure to answer the question : Figure 9-3 : shows the marginal cost curve,average total cost curve,average variable cost curve,and marginal revenue curve for a firm for different levels of output. 
-Refer to Figure 9-3.At the output level OB,total profits equal the area given by _____.
A)FTDE 
B)GMLR 
C)FHSR 
D)FBOR

Quizplus · Accepted Answer

Total profits are calculated as total revenue minus total cost. In the diagram, total revenue is represented by the area under the price line up to the output level (FHSR), and total cost is represented by the area under the average total cost curve up to the output level (FBGR). The profit is the difference between these two areas, which is FHSR minus FBGR, leaving the area FHSR as representing total profits.

Use the Following Figure to Answer the Question : Figure