A firm's total revenue equals $800. Its explicit costs equal $300 and its implicit costs equal...

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Question

A firm's total revenue equals $800. Its explicit costs equal $300 and its implicit costs equal...

A firm's total revenue equals $800. Its explicit costs equal $300 and its implicit costs equal $400. The firm's economic profit equals __________ and its accounting profit equals __________. $100; 500 -$100; $200 $400; -$300 $1,200; $1,500 $400; $100

business economics

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Answer 1

Answer #1

Solution :-

Economic Profit = Total Revenue - Implicit cost = 800 - 400 = $400

Accounting Profit = Total Revenue - Implicit cost - Explicit cost

= 800 - 400 - 300 = $100

Therefore the correct answer is $400;$100

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Answer 2

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