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SingaporeEconomicsQuick questions

Firms, Production and Costs

Quick questions on Costs, revenue and profit explained: O-Level Economics

4short Q&A pairs drawn directly from our worked dot-point answer. For full context and worked exam questions, read the parent dot-point page.

What is total cost?
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Total cost (TC) is everything the firm spends to produce its output:
What is average cost?
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Average cost (AC), also called cost per unit, is the total cost spread over the units produced:
What is revenue?
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Total revenue (TR) is the money a firm receives from selling its output:
What is profit?
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$Profit=Total revenue−Total cost\text{Profit} = \text{Total revenue} - \text{Total cost}$

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