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Gross Margin

Let’s again consider a heat engine operating across a thermal conductor.

In business, the Gross Profit Margin, or simply Gross Margin (MG), can be expressed as:

\(GM = \frac{R – C}{R}\).

The form of this equation may look familiar. It is identical in form to the expression for Carnot efficiency:

\(\epsilon = \frac{T_H – T_C}{T_C} =1 –  \frac{T_C}{T_H}\)

So we can now express Gross Margin thermodynamically:

\(GM = \epsilon =   1 –  \frac{T_C}{T_H}\)

We can now express Marginal Profit thermodynamically:

\(P =Q_H~\epsilon = Q_H~(1 -\frac{T_C}{T_H})\)

 

In Summary, the work performed by the heat engine represents profit (P):

\(W = Q_H (1 – \frac{T_C}{ T_H})\)

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