There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the options given below.
Assertion (A): Super profit is the excess of average profit over normal profit.
Reason (R): Normal profit can be calculated through average profit.
Answer & explanation
Correct answer: option 3
The excess of actual profits over the normal profits is termed as super profits.
Normal Profit = Firm’s Capital × Normal Rate of Return/100
Firms' capital includes partners' capital and reserves and surplus but excludes fictitious assets and goodwill.