Maximizing Revenue and Profit

Maximizing Revenue and Profit

Since the total revenue and total profit functions are different, their maximum points occur at different levels of demand. In the case of a linear price–demand relationship, the total profit typically reaches its maximum at a lower demand level than the maximum total revenue. 

However, for some price-demand functions (such as the nonlinear relationship discussed earlier), a real maximum revenue may not exist—and the same may hold true for profit.