Q300
If there are implicit costs of production
A.
Economic profit will be equal to accounting profit
B.
Economic profit will be less than accounting profit
AnswerC.
Economic profits will be zero
D.
Economic profit will be more than accounting profit.
Answer: Option B
Solution
Answer: Option B
Solution:
If there are implicit costs of production Economic profit will be less than accounting profit. Economic profit is total revenue minus opportunity cost. Accounting profit is total revenue minus explicit cost. Opportunity costs are higher than explicit costs because opportunity costs also include implicit costs.