When a firm earns zero economic profit, it has
A)not covered all its explicit costs.
B)not covered all its implicit costs.
C)not earned enough to stay in business.
D)definitely earned an accounting profit if implicit costs are positive.

Question

Quizplus · Accepted Answer

Zero economic profit means the firm has covered both its explicit and implicit costs, which implies it has earned an accounting profit if implicit costs are positive.

When a Firm Earns Zero Economic Profit, It Has