Which of the following is equivalent to economic profit?
(i) total revenue less explicit costs and less implicit costs
(ii) total revenue less opportunity costs
(iii) accounting profit
A)(i) only
B)(i) and (ii)
C)(ii) and (iii)
D)(i), (ii) and (iii)

Question

Quizplus · Accepted Answer

Economic profit is calculated by subtracting both explicit and implicit costs (including opportunity costs) from total revenue, making statements (i) and (ii) correct. Accounting profit, however, only subtracts explicit costs from total revenue and does not consider implicit or opportunity costs, making statement (iii) incorrect in this context.

Which of the Following Is Equivalent to Economic Profit