Scenario 9.2
Consider a publicly held firm (one whose stock shares are traded on the stock exchange) that earned revenue worth $350 million and incurred land, labor, and debt costs worth $320 million. The stockholders who have invested a total of $100 million in this firm could have earned 10 percent return on other comparable investments.
-A firm's economic profit includes all opportunity costs incurred by the firm.

Question

Quizplus · Accepted Answer

Economic profit includes all opportunity costs incurred by the firm, meaning it would take into account the opportunity cost of the $100 million invested by the stockholders, which is a 10 percent return on other comparable investments.

Scenario 9.2 Consider a Publicly Held Firm (One Whose Stock Shares Are