A dairy produces and sells organic milk. Last year it sold 500,000 gallons of milk at a price of $7 per gallon. For last year, the firm's a. explicit costs were $3.5 million. b. economic profit was $3.5 million. c. total revenue was $3.5 million. d. accounting profit was $3.5 million.

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ewomazinoade ewomazinoade · Answer 1 · 2020-07-03T02:25:43+02:00

Answer:

. total revenue was $3.5 million.

Explanation:

Total revenue = price x units sold = 500,000 x $7 = $3,500,000

Total explicit cost is the actual cost incurred in production. Total explicit cost includes fixed cost and variable cost.

Accounting profit is total revenue less total explicit cost.

Economic profit is accounting profit less implicit cost or opportunity cost.

Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives.

I hope my answer helps you