Economic profits are calculated by subtracting:

A) explicit costs from total revenue.
B) implicit costs from total revenue.
C) implicit costs from normal profits.
D) explicit and implicit costs from total revenue.

Economic Profits

Profits calculated by subtracting both explicit and implicit costs from total revenues.

Explicit Costs

The direct payment made to others in the course of running a business, such as wages, rent, and materials.

Implicit Costs

Implicit costs are the opportunity costs associated with a company's use of internal resources that could have been utilized elsewhere, not directly paid out in cash.