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Economic profit is the difference between the total revenue received by a business and the total implicit and explicit costs of a firm. It's often the extra profit left over after considering the next best alternative investment, and can be either positive or negative in value
Formula is:
Economic Profit = Accounting Profit - Implicit Costs
It is said that the company achieved an economic profit when the total average cost less than the cost of an additional product produced by the company, which means it is on the point of maximum production for profit.
