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Sagot :
Answer:
False
Explanation:
Accounting profit is defined as total revenue minus the sum of all explicit costs:
Accounting Profit = Total Revenue − Explicit Costs
Economic profit, by contrast, is defined as total revenue minus the sum of explicit costs and implicit costs:
Economic Profit = Total Revenue − (Explicit Costs + Implicit Costs)
= Total Revenue − Explicit Costs − Implicit Costs
Therefore, Economic Profit = Accounting Profit − Implicit Costs. Since economic profit is zero, Accounting Profit − Implicit Costs = 0.
Therefore, if economic profit is zero in the long run and implicit costs are positive, accounting profit must be positive. Indeed, in the case of zero economic profit, implicit costs and accounting profit are equal.
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Note: Economic Profit in the long run is ALWAYS ZERO.
Therefore: Economic Profit = Accounting Profit − Implicit Costs
0 = Accounting Profit − Implicit Costs
Implicit Costs = Accounting Profit
Accounting Profit = Implicit Costs
So: Assuming implicit costs are positive, each of the firms operating in this industry in the long run earns POSITIVE accounting profit.
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