Profit can be shown graphically by depicting a firm's costs and revenues, and it is determined mathematically by calculating the:
distance from price to average cost.
area of the box that is price times quantity.
area of the box that is average cost times quantity.
area of the box that is (price minus average cost) times the quantity.
Profit can be determined mathematically by calculating the:
area of the box that is (price minus average cost) times the quantity.
This is because profit is defined as total revenue minus total costs. In graphical terms, if you plot price on the vertical axis and quantity on the horizontal axis, the area representing profit is the difference between the price (revenue) and the average cost (cost