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  • Jul 5, 2007, 12:13 PM
    bluelegacygt
    abbreviation in equation
    I have an equation and I am not sure what some of the abreviations stand for. The equation is Profit = (P–AVC) Q–FC. I know P- is profit, Q- is quanity, and FC- is fixed cost but what is AVC? Is it Additional voluntary contribution?

    Can someone please let me know?
  • Jul 5, 2007, 12:32 PM
    Hermansherman
    Quote:
    Originally Posted by bluelegacygt
    i have an equation and i am not sure what some of the abreviations stand for. The equation is Profit = (P–AVC) Q–FC. i know P- is profit, Q- is quanity, and FC- is fixed cost but what is AVC? is it Additional voluntary contribution?

    Can someone please let me know?



    Profit = (Price - Average variable cost) * quantity - fixed cost

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