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Should businesses profit from war?

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Should businesses profit from war? Defend your answer with economic principles and the reasons why.

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Solution Summary

The expert examines if businesses should profit from war. Economic principles are determined.

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Let us first differentiate accounting profit and economic profit.

Accounting profit means revenue - cost. Economic profit is accounting profit - opportunity cost.

If you operate a store and your revenue is 8000/month, your cost is 3000/month. Your accounting profit would be 5000. But let's say that you can also work for as a teacher in a local school and your ...

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