Economic Profit

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• Supply of Loanable Funds

  How do the concepts of accounting profit and economic profit differ? Why is the economic profit smaller than accounting profit. What are the three basic sources of economic profit?

• difference between accounting and economic profit

  In other words, economic profit also takes into account opportunity cost of capital invested in the business, apart from other costs. Economic profit is lower than the accounting profit.

• Should businesses profit from war?

  -on the other hand, firms should not making economic profit because making economic profit means inefficiency.

• Accounting Profits

  Accounting profit = Total revenue - Explicit costs Accounting profit = 1,000,000 - (900,000 + 40,000) = 60,000 b) Economic profit is the difference between total revenue and total economic cost Economic profit = Total revenue - Explicit costs -

• Economic Profit Vs Accounting Profit

  What are her economic profits? $ _______ Please give a definition for both accounting profit and economic profit and show step-by-step calculations for both.

• ROI and Economic Profit Calculations

  Compute the economic profit for each division. Which division is the best performer based on economic profit? Explain.

• Net Present Value and Economic Profit for $1M capital investment

  Economic profit for the first year=700,000-600,000=100,000 Economic profit for the second year=700,000-400,000=300,000 PV (economic profit)=100,000/1.1+300,000/1.1^2=338,843 The expert determines the net present value and economic profits for $1M capital

• Sources of economic profit

  291369 Profits How do the concepts of accounting profit and economic profit differ? Why is economic profit smaller than accounting profit? What are the three basic sources of economic profit?

• difference between Economic and Normal profits

  Explain the difference between Economic and Normal profits. Economic profit equals revenue minus economic cost. Normal profit is a zero economic profit.

• Determining equations for accounting and economic profits

  When Q=200 Accounting profit=24Q-3600=24*200-3600=$1200 Economic Profit=24Q-10800=24*200-10800=-$6000 We got a positive value for accounting profit but a negative value for economic profit.