Microeconomics: Principles, Problems, & Policies, 20th Edition

by McConnell, Campbell; Brue, Stanley; Flynn, Sean

Published by McGraw-Hill Education

ISBN 10: 0077660811

ISBN 13: 978-0-07766-081-9

Chapter 9 - Businesses and the Costs of Production - Review Questions - Page 218: 1

Answer

Accounting profit = $ 300$ Economics profit = $ -3700

Work Step by Step

Accounting Profit = $ 10 \times 100 - 700 $ =$300 Economic profits = 10 * 100 - 20 * 100 -700 =1000-2000-700 =-3700 Thus, we see that accounting profit and economic profit can be quite different.

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