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 ($) To calculate the average profit, simply subtract the average cost from the average revenue. ## How to Calculate Average Profit? The following example problems outline how to calculate Average Profit. Example Problem #1: 1. First, determine the average revenue ($). 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 (\$)