If General Motors is earning only a normal profit,
A)it is making economic profit
B)it is breaking even
C)it is suffering an economic loss
D)it is covering only explicit costs
E)it is covering only implicit costs

Question

Quizplus · Accepted Answer

When a firm is earning only a normal profit, it means that its total revenue is equal to both its explicit and implicit costs, resulting in a zero economic profit. This indicates that the firm is breaking even and covering all its costs but not earning any extra profit.

If General Motors Is Earning Only a Normal Profit