Suppose that a business incurred implicit costs of $400,000 and explicit costs of $4 million in a specific year. If the firm sold 100,000 units of its output at $48 per unit, its accounting

Multiple Choice

• profits were $400,000 and its economic profits were $0.
• losses were $0 and its economic losses were $800,000.
• profits were $400,000 and its economic profits were $800,000.
• profits were $800,000 and its economic profits were $400,000.