Answer to Question #58087 in Microeconomics for Katie
Economic cost differs from accounting cost because it includes opportunity cost. In our case opportunity cost is $20per hour×10hours=$200. So economic cost is $100+$200=$300.
Accounting profit is consists of revenue minus explicit costs: $200-$100=-$100.
Economic profit consists of revenue minus implicit (opportunity) and explicit (monetary) costs:
$100; $300; $100; -100$ (loss)
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