Question

What is the difference between profit and revenue?

Revenue is the total amount producers receive after selling a good. Profit is the total amount producers earn after subtracting the production costs.
Revenue is the total amount producers earn after subtracting the production costs. Profit is the total amount producers receive after selling a good.
Revenue is the total amount producers pay to manufacture a good. Profit is the total amount producers earn after subtracting the production costs.
Revenue is the total amount producers pay to manufacture a good. Profit is the total amount producers receive after selling a good.

Answer 1

The revenue is the total amount producers receive after selling a good. Profit is the total amount producers earn after subtracting the production cost.

Explanation:

To answer the question, let us picture that you have a business, and you sell bread.

If you sell bread for $5 per loaf, and you sell 2 loaves, your revenue will be 2 * 5 = $10.

Let's say that in order to bake the bread, you have to rent your neighbor's oven for $0.25 per hour, the flour costs $1 per loaf, and the yeast costs $1 (these are all made-up numbers). If each loaf takes one hour to bake, two loaves will cost 0.5 + 2 + 2 = $4.50 to make. Your profit will then be your revenue minus your cost, or 10 - 4.5 = $5.50.

From this scenario, we can see that the revenue is the total amount producers receive after selling a good. Profit is the total amount producers earn after subtracting the production cost.

Hope this helps!

Answer 2

Revenue is the total amount producers receive after selling a good. Profit is the total amount producers earn after subtracting the production costs.

Explanation:

Profit, or net gain, is the amount of money made after subtracting production costs.

Revenue is the total amount of money earned, or gross weight, before anything is subtracted for production costs.