ECONOMICS
PROFIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Yes, I understand this from the notes
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No, I don’t understand this from the notes
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No, I don’t understand this, as I have not read the notes
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None of the above
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Detailed explanation-1: -Normal profit occurs when economic profit is zero, or when the total revenue of a company equals the sum of implicit cost and explicit cost. It is the point where the business utilizes all the available resources efficiently, and the compensation is higher than the opportunity cost lost to produce the product.
Detailed explanation-2: -Competitive companies whose total expenses are covered by their total revenue end up earning zero economic profit. Zero accounting profit, though, means that a company is running at a loss. This means that its expenses are higher than its revenue.
Detailed explanation-3: -Normal profit is an economic term that describes a situation in which a company’s total costs are equal to its total revenue. More specifically, the total implicit and explicit costs equal the total amount of money the company generated within a specified period.
Detailed explanation-4: -Normal profit is Part of total cost. Normal profit is an economic term that describes when a company’s total revenues are equal to its total costs in a perfectly competitive market.