Accounting profits can tell a business _______________________,and economic profits can tell a business ______________________.

Question

Quizplus · Accepted Answer

Accounting profits are the profits earned by deducting all business expenses from the total revenue received, whereas economic profits are the profits earned by deducting all business expenses, including opportunity costs, from the total revenue received. Accounting profits can indicate whether a business is making money or not, but economic profits can determine if the business can make more money by pursuing a different investment or opportunity.

Accounting Profits Can Tell a Business _______________________,And Economic Profits Can