Profit is defined as
A)net revenue minus depreciation.
B)total revenue minus total cost.
C)average revenue minus average total cost.
D)marginal revenue minus marginal cost.

Question

Quizplus · Accepted Answer

Profit is the difference between total revenue and total cost. Option B correctly shows this relationship. Option A is not the correct definition of profit as depreciation is not a part of revenue or cost. Option C is the relationship between average revenue and average total cost and not relevant to the definition of profit. Option D calculates the difference between the revenue from selling one additional unit and the cost of producing that additional unit, which is not the same as total profit.

Profit Is Defined as