If a firm sells its output at a price greater than AC, it will earn economic profit.

Name: If a firm sells its output at a price greater than AC, it will earn economic profit.
Brand: Quizplus
Rating: 4.9 (52 reviews)

Question

Quizplus · Accepted Answer

Economic profit is earned when the price of a good exceeds the average total cost (AC) of producing it. In this case, the firm would be earning more revenue per unit than it is spending on production, resulting in a positive economic profit.

If a Firm Sells Its Output at a Price Greater