Question

Suppose that a business incurred implicit costs of $200,000 and explicit costs of $1 million in a specific year. If the firm sold 4,000 units of its output at $300 per unit, its accounting profits were:_________

Answer 1

Answer:

$200,000

Explanation:

Accounting profit = Total revenue - Explicit cost

Total revenue = 4000 × $300 = $1,200,000

$1.2 million - $1 million = $200,000

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