Answered

if a firm has total revenue of $200 million, explicit costs of $190 million, and implicit costs of $30 million, its economic profit is: group of answer choices -$10 million. $200 million. $70 million. $10 million. -$20 million.

Answer :

The economic profit is -$20 million.

What is economic profit?

Economic profit is defined as a profit or a loss that can be determined by deducting the explicit costs and the opportunity costs from the money or the revenue generated by a company. It is important to mention that economic profit helps in the measurement of efficiency, and success, and also ranks the different opportunities. Furthermore, the calculation also has certain disadvantages and including issues in making estimations, and does not have certain financial aspects.  

Given that,

Total revenue = $200 million

Explicit costs = $190 million

Implicit costs =$30 million

Hence,

Economic profit = 200 - (190 + 30) = 200 - 220 = -20 million

It can be concluded that the economic profit is -$20 million.

To know more about economic profit, check this link:

https://brainly.com/question/28272608

#SPJ4

Other Questions