It is important to distinguish factor rents from economic profit. In the standard single variable input production model, the profit-maximizing producer uses input X up to the point where MVP = MFC, which generates the level of output where MR = MC.

On the input side, the total rent earned by the variable input is (AVP - Px)*X.
On the output side, the total profit is (Py - ATC)*Y.
The difference is the Fixed Cost: Profit = Rent - FC.

The following graphs illustrate the linkages between the producer's input and output decisions. These graphs were generated in an Excel spreadsheet using a logistic production function Y = 350/[1+exp(5-0.0025X)] with Px = $10, Py = $125 and FC = $10,000 per month.

INPUT SIDE

OUTPUT SIDE