A normal profit is defined as
A) the same thing as accounting profit.
B) the economic profit minus the implicit costs.
C) the return to entrepreneurship.
D) total revenue minus explicit costs.
E) total revenue minus implicit costs.

Question

Quizplus · Accepted Answer

Normal profit is the return to entrepreneurship or the minimum level of profit required to keep a firm in operation. It is the level of profit that covers both explicit (out-of-pocket) costs and implicit (opportunity) costs, but does not provide any additional economic profit. It is sometimes referred to as "zero economic profit". Therefore, option C is the correct answer.

A Normal Profit Is Defined as