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What Is the Difference Between Accounting Profit and Economic Profit

Question 149

Multiple Choice

What is the difference between accounting profit and economic profit?


A) They are the same thing.
B) They are only different if the accountant makes a mistake.
C) Accounting profit is usually smaller than economic profits.
D) Accounting profit makes no allowance for several implicit costs, including equity capital, while economic profit takes these costs into account.

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