Which represent the economic profit generated by business above and beyond the minimum return required by all the provide of capital?
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Answer:
Economic profit refers to the difference in the ‘rate of return over’ the cost of capital of the enterprise.
Explanation:
The process is used for calculating the profits which is generated by the company from the resources that have been invested in the company. If a company's economic profit is ‘negative’.
it means the company is not doing well and hence it is not generating profits from the resources invested into the business. The positive effect of the economic profit explains the benefits of the invested funds.
Profit = total revenue – total cost.
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