If a Firm Has Total Revenue of $200 Million, Explicit

question 114

Multiple Choice

If a firm has total revenue of $200 million, explicit costs of $190 million, and implicit costs of $30 million, its economic profit is:

• A) $200 million.
• B) $70 million.
• C) $10 million.
• D) −$10 million.
• E) −$20 million.

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Definitions:

Lag Indicators

Measures that reflect the success or failure after the fact, helping businesses understand the results of past actions or events.

Balanced Scorecard

A strategic planning and management system used by organizations to communicate what they are trying to accomplish and measure progress towards their goals.

Performance Measures

Quantitative indicators used to assess how well an organization or individual is achieving its goals and objectives.

Gross Cost

The total cost incurred before deducting any discounts, allowances, or rebates.