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Normal profit:
Normal profit is when total revenue is exactly equal to total cost when the latter includes both explicit costs. It is the type of profit when made by firms in an industry does not attract new firms into the industry even when no barriers to entry exist. Existing firms also do not leave industry also. The firm’s profit then is equal to the implicit costs.
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Direction of Trade: It is indicative of the structure and level of economic development. As a country develops and its trade gets diversified, it has to seek new outlets for i
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