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White raven [17]
3 years ago
6

An airline has a marginal cost per passenger of $20 on a route from Detroit to New Orleans. At the same time, the typical fare c

harged is $400. The planes that fly the route are usually full, yet the airline claims it loses money on the route. This loss may occur because Choose one: A. economic profits are less than accounting profits. B. total costs are higher than the sum of fixed costs and variable costs.
Business
1 answer:
Len [333]3 years ago
8 0

Answer:

A

Explanation:

Accounting profit= total revenue - explicit cost

Total revenue =price x quantity sold  

Explicit cost includes the amount expended in running the business.

They include rent , salary and cost of raw materials

Economic profit = accounting profit - implicit cost

Implicit cost is the cost of the next best option forgone when one alternative is chosen over other alternatives

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