The level of profit that occurs when the total revenue is to the total cost is known as normal profit.
Question
The level of profit that occurs when the total revenue is to the total cost is known as normal profit.
Solution
Yes, you are correct. Normal profit is a situation in economics when the total revenue is equal to the total cost. This means that the firm is just covering all its costs including a provision for the opportunity cost of the entrepreneur's time and capital. It is a minimum level of profit needed for a company to remain competitive or stay in business.
Similar Questions
Total revenue minus the implicit and explicit costs of production is profit.
What is normal profit and in what way is economic profit different from accounting profit?
Profit is calculated as revenue minus total costs.Group of answer choicestruefalse PreviousNext
A firm's total revenue minus its explicit cost is called itsGroup of answer choiceseconomic profit.abnormal profit.accounting profit.normal profit.
Normal profit is also known as zero profit.
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