Enter the total revenue and total cost into the calculator to determine the maximum profit. This calculator can also evaluate any of the variables given the others are known.

## Max Profit Formula

The following formula is used to calculate the maximum profit.

Max Profit = TR - TC

Variables:

- Max Profit is the maximum possible financial gain ($)
- TR is the total revenue ($)
- TC is the total cost ($)

To calculate the maximum profit, subtract the total cost from the total revenue. The difference between these two values represents the maximum possible financial gain that can be achieved from a particular transaction or series of transactions.

## What is a Max Profit?

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.

## How to Calculate Max Profit?

The following steps outline how to calculate the Max Profit.

- First, determine the total revenue (TR) ($).
- Next, determine the total cost (TC) ($).
- Next, gather the formula from above = Max Profit = TR – TC.
- Finally, calculate the Max Profit.
- After inserting the variables and calculating the result, check your answer with the calculator above.

**Example Problem : **

Use the following variables as an example problem to test your knowledge.

total revenue (TR) ($) = 150

total cost (TC) ($) = 100