3.3 - revenue + profit

Question 1

Total revenue

Answer 1

The total amount of money a business accumulates due to selling of G / S

Question 2

Total revenue formula

Answer 2

Price per unit x quantity sold

Question 3

Average revenue

Answer 3

Revenue earned from selling one G/S

Question 4

Average revenue formula

Answer 4

Total revenue / Quantity

Question 5

Marginal revenue

Answer 5

The additional revenue gained from selling one extra unit

Question 6

Marginal revenue formula

Answer 6

Change in total revenue /
Change in quantity

Question 7

Profit

Answer 7

Financial gain following costs spent and revenue earned

Question 8

Loss

Answer 8

A minus following costs spent and revenue earned

Question 9

Profit / loss formula

Answer 9

TR - TC

Question 10

Accounting profit

Answer 10

Profit after deductions of explicit costs from revenue
(Explicit costs = normal business expenses (wages / raw materials))

Question 11

Normal profit

Answer 11

When implicit + explicit costs = TR
When a firm generates 0 economic profit
When all resources are being used efficiently

Question 12

Supernormal profit

Answer 12

Excess profit made above the minimum amount needed to keep a firm in the market