Normal profit is an implicit cost.

Question

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Normal profit is defined as the minimum amount of profit necessary to keep a firm operating in the long run. It is considered an implicit cost because it is not an out-of-pocket expense, but rather an opportunity cost that is forgone when a firm chooses to produce a good or service. In other words, normal profit is the amount of profit that a firm could earn by allocating its resources to an alternative use, and thus it represents a cost of doing business.

Normal Profit Is an Implicit Cost