[amp_mcq option1=”Part of total cost” option2=”Part of economic profit” option3=”Total revenue minus total cost” option4=”Total revenue minus implicit cost” correct=”option1″]<\/p>\n
The correct answer is: A. Part of total cost.<\/p>\n
Normal profit is the minimum amount of profit that a firm must make in order to stay in business. It is calculated by taking the total cost of production and subtracting the total revenue generated from sales. If a firm’s total revenue is less than its total cost, then the firm is making a loss. If a firm’s total revenue is equal to its total cost, then the firm is making a normal profit. If a firm’s total revenue is greater than its total cost, then the firm is making an economic profit.<\/p>\n
Option B is incorrect because economic profit is the total profit that a firm makes after accounting for all costs, including implicit costs. Implicit costs are the opportunity costs of using resources that are owned by the firm. For example, if a firm owns its own building, then the implicit cost of using the building is the rent that the firm could have earned if it had rented the building to another firm.<\/p>\n
Option C is incorrect because total revenue is the total amount of money that a firm receives from selling its goods or services. Total cost is the total amount of money that a firm spends on producing its goods or services. Normal profit is the minimum amount of profit that a firm must make in order to stay in business.<\/p>\n
Option D is incorrect because total revenue minus implicit cost is equal to economic profit.<\/p>\n","protected":false},"excerpt":{"rendered":"
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