Types of Profit- Micro Topic 3.4
Hey econ students. Here’s a quick video explaining the difference between accounting profit and economic profit. Just remember that accountants only factor in explicit costs while economists factor in explicit AND implicit costs. Also, remember that making zero economic profit is not a bad thing. If a company makes no economic profit then they are still making accounting profit and covering their opportunity costs.
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The answers to the practice questions are in the first comment below.