Why is it not a contradiction to say that a firm is simultaneously earning an accounting profit but suffering an economic loss?
What will be an ideal response?
Accounting profit is determined by taking total revenue and subtracting explicit costs only. Economic profit is determined by taking total revenue and subtracting all economic costs which include explicit and implicit costs. Therefore, this statement is not a contradiction.
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How would you describe an economy that uses its resources to make the greatest possible number of goods and services?
a) efficient b) using opportunity costs well c) globally aware d) underutilized
Refer to the table above. For which of the following choices is the marginal total cost the lowest?
A) Choosing factory Close over factory Far B) Choosing factory Far over factory Very Far C) Choosing factory Very Close over factory Close D) Choosing factory Close over factory Very Far