Quantity Sold |
Price |
TC |
TR = P x Q |
Profit = TR - TC |
0 |
10 |
5 |
10 x 0 = 0 |
0 - 5 =- 5 |
1 |
10 |
15 |
10 x 1 = 10 |
10 - 15 = - 5 |
2 |
10 |
22 |
10 x 2 = 20 |
20 - 22 = -2 |
3 |
10 |
27 |
10 x 3 = 30 |
30 - 27 = 3 |
4 |
10 |
31 |
10 x 4 = 40 |
40 - 31 = 9 |
5 |
10 |
38 |
10 x 5 = 50 |
50 - 38 = 12 |
6 |
10 |
49 |
10 x 6 = 60 |
60 - 49 = 11 |
7 |
10 |
63 |
10 x 7 = 70 |
70 - 63 = 7 |
8 |
10 |
81 |
10 x 8 = 80 |
80 - 81 = -1 |
9 |
10 |
101 |
10 x 9 = 90 |
90 - 101 = -11 |
10 |
10 |
123 |
10 x 10 = 100 |
100 - 123 = - 23 |
Profit maximising output is where the difference between TR and TC is the maximum. This exists at 5 units of output, where firm is earning profit of Rs 12.