Enter the average revenue ($) and the average cost ($) into the calculator to determine the Average Profit. 

Average Profit Formula

The following formula is used to calculate the Average Profit. 

Pave = AR – AC

  • Where Pave is the Average Profit ($)
  • AR is the average revenue ($) 
  • AC is the average cost ($) 

How to Calculate Average Profit?

The following example problems outline how to calculate Average Profit.

Example Problem #1:

  1. First, determine the average revenue ($). In this example, the average revenue ($) is given as 65.
  2. Next, determine the average cost ($). For this problem, the average cost ($) is given as 5.
  3. Finally, calculate the Average Profit using the equation above: 

Pave = AR – AC

The values given above are inserted into the equation below:

Pave = 65 – 5 = 60.00 ($)


Example Problem #2: 

The variables needed for this problem are provided below:

average revenue ($) = 70

average cost ($) = 8

Entering these values and solving gives:

Pave = 70 – 8 = 62.00 ($)