Ace the 2026 OnRamps Economics Challenge – Elevate Your College Game!

Profit is what’s left after paying all costs. Total revenue is the income from selling goods (price times quantity), and total cost includes every expense of producing that output (fixed plus variable). When you subtract total cost from total revenue, you get profit. If revenue exceeds costs, you earn a profit; if revenue equals costs, you break even; if revenue is less than costs, you incur a loss. So the statement that profit equals total revenue minus total cost is true in the standard accounting sense. (Keep in mind some contexts distinguish accounting vs economic profit based on what is counted as a cost, but the basic arithmetic remains TR minus TC.)