Respuesta :
Answer:
$5,000
Explanation:
Data given in the question is
Withdrawn amount = $100,000
Interest rate = 5%
Accounting profit = $10,000
So, by considering the above information, the economic profit is
= Accounting profit - Withdrawn amount × interest rate
= $10,000 - $100,000 × 5%
= $10,000 - $5,000
= $5,000
The Withdrawn amount × interest rate reflect the opportunity cost
Answer:
$ 5000
Explanation:
Accounting Profit is excess of Total Revenue over Total Explicit Costs
Economic Profit is excess of Total Revenue over Total Implicit costs (including all opportunity costs)
Accounting Profit = 100000
Implicit Cost = Opportunity Cost = Interest at 100000 foregone
= 5% at 100000 = 5000
Economic Profit = Accounting Profit - Implicit Costs
= 10000 - 5000
= $ 5000
