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Economic profits are equal to: 1. zero economic profits. 2. marginal revenue. 3. negative economic profits....

Economic profits are equal to:

1. zero economic profits.

2. marginal revenue.

3. negative economic profits.

4. normal profits.

5. positive economic profits.

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Answer #1

Ans. 5. Positive economic profits.

If the price is greater than the average total cost at the profit maximization output level, then the firm will earn economic profit and it is also called as a positive economic profit.

If the price is equal to the average total cost at the profit maximization output level, then the firm will earn zero economic profit and it is also called as a normal economic profit.

If the price is less than the average total cost at the profit maximization output level, then the firm will have an economic loss and it is also called as a negative economic profit.

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