When Ford Motor Company reports that it earned a loss of $100 million for the fourth quarter of 2007, the firm is

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When Ford reports a loss of $100 million, it is indicating a negative accounting profit. Economic profit considers both explicit and implicit costs, including opportunity costs. Since accounting profit only includes explicit costs, if the accounting profit is a loss, the economic profit would be even more negative once implicit costs are considered.

When Ford Motor Company Reports That It Earned a Loss