Answer (D) is correct . Normal profit is the level of profit necessary to induce entrepreneurs to enter and remain in the market. Economists view this profit as an implicit cost of economic activity.
Answer (A) is incorrect because Economic (pure) profit is the residual return in excess of normal profit. Economic profit equals total revenue minus opportunity costs. These are the sum of explicit and implicit costs, including normal profit.
Answer (B) is incorrect because Accounting profit is the excess of total revenue over explicit costs (out-of-pocket payments to outsiders).
Answer (C) is incorrect because A normal profit is an implicit cost.
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