all of the following can be used to compute profit per unit except:
a) price minus avg total cost.
b) total profit divided by quantity.
c) avg revenue minus avg total cost
d) marginal profit minus marginal cost
take a shot, what do you think?
Hint: d)
To determine which of the options cannot be used to compute profit per unit, let's examine each option:
a) Price minus average total cost: This option can be used to compute profit per unit. To calculate profit per unit using this method, subtract the average total cost from the price of the unit.
b) Total profit divided by quantity: This option can also be used to compute profit per unit. Simply divide the total profit by the quantity of units to determine the profit per unit.
c) Average revenue minus average total cost: This option can be used to compute profit per unit. To calculate profit per unit using this method, subtract the average total cost from the average revenue.
d) Marginal profit minus marginal cost: This option cannot be used to compute profit per unit. Marginal profit represents the additional profit earned from selling one additional unit, while marginal cost represents the additional cost incurred from producing one additional unit. Therefore, subtracting marginal cost from marginal profit does not yield profit per unit.
Based on the analysis above, the option that cannot be used to compute profit per unit is:
d) Marginal profit minus marginal cost.