Economic profit and economic loss, Microeconomics

Economic profit and Economic loss:

Economic profit is the excess if total revenue over total cost when the latter includes both explicit and implicit costs. It is the type of profit when made by firms in an industry attracts new firms into the industry when no barriers to entry exist while existing firms also expand their production.It is also called pure or supernormal profit.

Economic Loss is the excess of total cost (both implicit and explicit) over total revenue. This type of loss when made by firms in an industry would discourage firms which are unable to cover their variable costs to exit the industry while those who are able to cover their variable costs to exit the industry while those who are able to cover their variable costs to exit the industry while those who are able to cover their variable costs will stay in the short run.

Posted Date: 1/2/2013 11:52:27 PM | Location : United States







Related Discussions:- Economic profit and economic loss, Assignment Help, Ask Question on Economic profit and economic loss, Get Answer, Expert's Help, Economic profit and economic loss Discussions

Write discussion on Economic profit and economic loss
Your posts are moderated
Related Questions
Discount Rate The term discount rate relates to business valuations. It is the rate applied to a future torrent of making an income or cash flow to measure its represen


How might a “perfect” macro equilibrium be affected by (a) a stock market crash; (b) the death of a president; (c) a recession in Canada; (d) a spike in oil prices?

I wanted to the fixed and variable costs of breadtalk in singapore from economic perspective

Floating exchange rates There are two basic systems that can be used to determine the exchange rate between one country's currency and another's: a floating exchange rates (al


Balance of Payments and Developing Economies: It is well-known in development economics that UDCs invariably start as debtor economies. In the process of development itself, t

Technical Economies: They are economies that accrue from the use of large machines with emphasis on full utilization and efficiency in production. First, there are some equip

#. The following information applies to the market for a particular items in the absence of a unit excise tax: Price($ per unit) Quantity Supplied Quantity Demanded 4 50

Jane receives utility from days spent travelling on vacation domestically(D) and days