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Suppose that a business had implicit costs of $250 000 and had explicit costs of $4.5 million in a specific year. If in that year the firm sold 100 000 units of its output at 550 per unit, its accounting losses were $500 000 and its economic losses were zero profits were zero and its economic losses were $250 000 profits were $500 000 and its economic profits were $250 000 profits were $100 000 and economic profits were zero profits were zero and its economic profits yere $250 000

Suppose that a business had implicit costs of $250 000 and had explicit costs of $4.5 million in a specific year. If in that year the firm sold 100 000 units of its output at 550 per unit, its accounting losses were $500 000 and its economic losses were zero profits were zero and its economic losses were $250 000 profits were $500 000 and its economic profits were $250 000 profits were $100 000 and economic profits were zero profits were zero and its economic profits yere $250 000

EBK CFIN
EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter7: Stocks (equity) - Characterstics And Valuation
Section: Chapter Questions
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Suppose that a business had implicit costs of $250 000 and had explicit costs of $4.5 million in a specific year. If in that year the firm sold 100 000 units of its output at $50 per unit, its accounting losses were $500 000 and its economic losses were zero profits were zero and its economic losses were $250 000 profits were $500 000 and its economic profits were $250 000 profits were $100 000 and economic profits were zero profits were zero and its economic profits yere $250 000
Transcribed Image Text:Suppose that a business had implicit costs of $250 000 and had explicit costs of $4.5 million in a specific year. If in that year the firm sold 100 000 units of its output at $50 per unit, its accounting losses were $500 000 and its economic losses were zero profits were zero and its economic losses were $250 000 profits were $500 000 and its economic profits were $250 000 profits were $100 000 and economic profits were zero profits were zero and its economic profits yere $250 000
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