Economic profit is the difference between total revenue and
A. opportunity costs of production.
B. explicit costs of production.
C. interest costs of production.
D. implicit costs of production.
In the parlance of economics, the total costs of a firm may be bifurcated into two kinds, namely, explicit or accounting costs and economic costs. The accounting profit is usually determined by taking into account the accounting costs while the economic profit is ascertained by taking into consideration the economic profit.
Answer and Explanation: 1
The economic profit for a firm is determined by deducting both the explicit costs of production and the implicit costs of production from the total...
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fromChapter 3 / Lesson 11
Learn what the definition of economic profit is, and understand how to calculate it using an equation.