The formula to calculate the Max Profit is:
\[ \text{Max Profit} = TR - TC \]
Where:
Max Profit refers to the highest possible financial gain that a business or individual can achieve from a particular transaction or series of transactions. It is the point where the difference between total revenue and total cost is the greatest. This concept is crucial in business decision-making processes, as it helps determine the most profitable strategies and actions. Factors influencing max profit include sales price, production costs, demand, and market competition.
Let's assume the following values:
Using the formula to calculate the Max Profit:
\[ \text{Max Profit} = 100,000 - 70,000 = 30,000 \]
The Max Profit is $30,000.
