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      Question

      Difference of average revenue and average total cost

      equals
      A total economic profit. Correct Answer Incorrect Answer
      B total accounting profit. Correct Answer Incorrect Answer
      C a normal profit. Correct Answer Incorrect Answer
      D economic profit per unit of output. Correct Answer Incorrect Answer

      Solution

      Average Revenue (AR) is the revenue per unit sold (essentially the price). Average Total Cost (ATC) is the cost per unit. Therefore, AR - ATC represents the profit (or loss) per unit of output. This is the economic profit per unit.

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