If a business’ total economic cost of producing 10,000 units of a product is N750,000 and this output is sold to consumers for N1,000,000, then the firm would earn
- A normal profit of N750,000
- An economic profit of N750,000
- A normal profit o N1,750,000
-
An economic profit of N250,000
The correct answer is: D
Explanation
Economic profit = Total revenue(Output) - Opportunity cost of input
= 1,000,000 - 750,000
= 250,000