2012.04.30 - ECON1101, Week 9 Lecture Notes

Explicit costs the opportunity costs of resources

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: s) 9-3 ECONOMIC PROFIT !  Explicit costs The opportunity costs of resources that the firm uses that are supplied from outside the firm !  Implicit costs The value of best opportunity forgone by the firm when it uses resources supplied by the firm’s owners 9-4 ACCOUNTING PROFIT !  The difference between a firm’s total revenue and its explicit costs !  Accounting profit = total revenue – explicit costs 9-5 NORMAL PROFIT !  The level of accounting profit that a firm earns when economic profit is zero. It is equal to the opportunity cost of the resources supplied to a business by its owners 9-6 THE THREE CONCEPTS OF PROFIT 9-7 SHOULD ANDY...
View Full Document

This note was uploaded on 03/12/2014 for the course ECON 1101 taught by Professor Julia during the Three '08 term at University of New South Wales.

Ask a homework question - tutors are online