Which term refers to the financial gain from business operations after expenses?

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Master the EPF Supply and Demand Basics Test. Enhance your understanding of supply and demand with interactive quizzes and detailed explanations. Get ready to excel in your exam!

The term that refers to the financial gain from business operations after expenses is profit. Profit is calculated by subtracting total expenses from total revenue. This metric is crucial for understanding a business's financial health, as it indicates how well the company is managing its resources and generating earnings from its operations.

When a business makes sales, it generates revenue, but this revenue does not reflect the financial success of the business until expenses, such as cost of goods sold, operating expenses, taxes, and interest, are taken into account. The resulting profit signals how much money the business has made beyond its costs and is essential for decision-making and strategic planning.

In contrast, revenue refers to the total income generated before any expenses are deducted, while cost pertains to the expenses incurred in producing goods or services. Supply is related to the quantity of goods available in the market and does not pertain directly to the financial outcomes of business operations. Thus, profit is the correct term that captures the essence of the financial surplus remaining after all operational expenses have been accounted for.

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