Note: This is post #42 in a weekly video series on basic microeconomics.

In petitive market, pany can’t control how much they charge for goods and services. So how do firms maximize profits when they don’t control prices? In this video by Marginal Revolution University, Alex Tabarrok defines profit, including how to calculate total revenue and total cost, and covers costs, variable costs, marginal revenue, and marginal cost.

(If you find the pace of the videos too slow, I’d mend watching them at 1.5 to 2 times the speed. You can adjust the speed at which the video plays by clicking on “Settings” (the gear symbol) and changing “Speed” from normal to 1.25, 1.5 or 2.)

Previous in series: Introduction to petitive firm