Economic Profit = Revenue - (explicit costs+implicit costs)
= Revenue -(opportunity costs)
Accounting Profit = Revenue -explicit costs.
For example let revenue be $1,000,000
Explicit costs = 800,000
Had the company rented its unused premises , the implicit costs = 100,000
Accounting profit =1,000,000-800,000 =200,000
Economic Profit =1,000,000-800,000-100,000=100,000
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