When a firm is earning positive economic profits,this is an indication that the firm

Question

Quizplus · Accepted Answer

Positive economic profits indicate that the firm is generating more revenue than its total cost, including both explicit and implicit costs. This suggests that the firm is using its resources in the best possible way, which is reflected in its profitability. Leaving the market in the long run (choice A) is not necessary if the firm continues to earn positive profits. Choice C is not a valid option since a firm can only achieve positive economic profits by using its resources in the most efficient and effective manner.

When a Firm Is Earning Positive Economic Profits,this Is an Indication