A firm earns a positive economic profit when total revenue exceeds

Question

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Economic profit takes into account opportunity cost, which includes the cost of the next-best alternative use of resources in addition to accounting costs (option E). A positive economic profit means that total revenue covers all costs, including both variable and fixed costs (options B and C), as well as per-unit costs (option D). However, option A includes all these costs and is the most complete answer.

A Firm Earns a Positive Economic Profit When Total Revenue