Is it possible for accounting profit to be positive and economic profit to be negative?

Answers

Answer 1
Answer:

Answer:

Yes.

Explanation:

We know,

Accounting profit = Revenue - Explicit cost.

Economic profit = Revenue - Explicit cost - Implicit cost

Explicit cost is the day to day expenses, while the implicit cost is the expanses that have already occurred.

Therefore, the explicit cost may not be higher than the revenue. So accounting profit can be positive.

However, as we have to deduct the explicit cost as well as implicit cost from economic profit, it can be positive, negative, or even zero. So the statement is correct.

Answer 2
Answer:

Final answer:

It is possible for accounting profit to be positive and economic profit to be negative when the implicit costs used in calculating economic profit are greater than the accounting profit. This indicates that the resources used in the business could generate higher returns if invested elsewhere.

Explanation:

Yes, it is indeed possible for accounting profit to be positive while economic profit is negative. This scenario arises due to the difference in what is considered a cost in the computation of each type of profit. Accounting profit is total revenue minus explicit costs, which are direct, out-of-pocket expenses. It does not consider implicit costs, which are the opportunity costs of using resources in one way instead of another. These might include the entrepreneur's time or the potential earnings that could have been generated if capital had been invested elsewhere.

On the other hand, economic profit is total revenue minus total cost, including both explicit and implicit costs. Even when a business is generating a positive accounting profit, if the implicit costs are higher than this accounting profit, the economic profit may be negative. This translates to the business not being as profitable as it could be if the resources had been invested elsewhere. This difference is important because while a business pays income taxes based on its accounting profit, whether it is economically successful depends on its economic profit. The decision to continue a business would depend on positive economic profit.

Learn more about Accounting and Economic Profit here:

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How can advertising affect consumers? Select one:a. It can change cultural practices and conventions
b. It can change strongly held values
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Answers

I would say that the main purpose of advertising is to change the negative attitudes to positive ones. Let's take political campaigning for instance. Notice that the television channels are filled with ads of politicians who are campaigning to become the president. Most people have a negative attitude when it comes to politics which is why advertising is trying to make certain politicians look good in order for them to win enough votes. 

When evacuating the premises during an active shooter incident, your responsibilities to others include: Warning individuals not to enter the area where the active shooter may be. Helping others escape, if possible.?

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It include warning individuals not to enter the area where the active shooter may be

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At his comic book store, Korey’s Comics, Korey sells approximately $3,250 in comic books each month. But as a comic book dealer, Korey only pays $1,285 for these comic books. Korey’s monthly operating expenses, including labor, are $875. Calculate Korey’s monthly net income. a. $1,090 b. $1,965 c. $2,375 d. $2,840 Please select the best answer from the choices provided A B C D

Answers

Answer:

a. 1,090

Explanation:

Without any other information provided, the easiest way to answer this question is to make directly the calculations of income and costs. the logic behind this problem is to calculate all the income and substract the costs of production, in this particular case we have:

+Income: 3,250

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-Operating expenses: 875

Net Income: 1,090

The correct answer is C on Edge practice test. I used quizlet.

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Answers

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