3.6 What is meant by profit?

What students need to learn:

Content	Students should be able to:	Additional Guidance Notes
Normal and supernormal profit	Understand the distinction between normal and supernormal profit.	This can be related to the understanding of the objectives of the firm and the ability of different firms to make normal and supernormal profit.
Profit maximisation	Explain and illustrate the concept of profit maximisation using marginal cost and marginal revenue.