The minimum level of profit that is needed to keep a firm in the existing business is
Answer & explanation
Correct answer: option 2
The correct answer is Option 2: normal profit
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Normal Profit: Normal profit is the minimum level of profit required to keep a firm in its current business.
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It represents the opportunity cost of the firm's resources.
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It includes the return that the firm's owners could earn by investing their resources elsewhere.
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If a firm earns less than normal profit, it would be better off using its resources in an alternative venture.