A return that is just sufficient to recover an entrepreneur's opportunity cost is known as
A) opportunity profit
B) extra-normal profit
C) normal profit

Question

Quizplus · Accepted Answer

Normal profit is the minimum return required for an entrepreneur to stay in business and cover their opportunity cost, including the salary they could have earned in their next best alternative. It is also known as a break-even point where the revenue is equal to the total costs, including both explicit and implicit costs. Therefore, the correct answer is C. Option A is incorrect as opportunity profit suggests earning more than the opportunity cost, and option B is incorrect as extra-normal profits refer to profits in excess of normal profits.

A Return That Is Just Sufficient to Recover an Entrepreneur's