ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -However, economic profits and accounting profits are two types of profits. Economic profit refers to total revenue from sales minus opportunity costs from all inputs. Accounting profit, on the other hand, represents the total earnings of a company, which includes explicit costs.

Detailed explanation-2: -To create accurate financial statements and monitor your business’s financial health, you should understand the two types of profits: gross profit and net profit.

Detailed explanation-3: -There are three main measures of profit. These are gross profit, operating profit and net profit.

Detailed explanation-4: -An economic profit is the difference between the revenue received from sales and the explicit costs of producing its goods and services, as well as any opportunity costs.

Detailed explanation-5: -Economic profit refers to minus all relevant costs, both explicit and implicit.