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.
- Three '08