Final answer:
A firm's total profit is equal to its marginal revenue minus its marginal cost.
Step-by-step explanation:
A firm's total profit equals its marginal revenue minus its marginal cost.
This statement is true. Total profit can be calculated by subtracting a firm's marginal cost from its marginal revenue. Marginal revenue refers to the change in revenue caused by producing and selling one more unit of a good or service, while marginal cost refers to the change in total cost caused by producing one more unit.
For example, let's say a firm's marginal revenue for selling one more unit of a product is $10 and its marginal cost for producing that unit is $5. The firm's total profit would be $10 - $5 = $5.
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