The difference between the cost of inputs and the value or price of outputs is known as "economic profit" or "economic value added". Here's how you can calculate it:

Step 1: Determine the Cost of Inputs
The cost of inputs includes all the expenses incurred to produce a product or service. This could include raw materials, labor costs, overhead costs, and any other direct or indirect costs associated with production.

Step 2: Determine the Value or Price of Outputs
The value or price of outputs is the amount for which the product or service is sold. This could be the retail price, wholesale price, or any other price at which the product or service is sold to the end customer.

Step 3: Subtract the Cost of Inputs from the Value or Price of Outputs
The difference between the value or price of outputs and the cost of inputs is the economic profit or economic value added. If this value is positive, it means that the business is making a profit. If it's negative, it means that the business is operating at a loss.

For example, if a company spends $100 on inputs to produce a product and sells that product for $150, the economic profit is $50 ($150 - $100).

Question

The difference between the cost of inputs and the value or price of outputs is known as "economic profit" or "economic value added". Here's how you can calculate it:

Step 1: Determine the Cost of Inputs
The cost of inputs includes all the expenses incurred to produce a product or service. This could include raw materials, labor costs, overhead costs, and any other direct or indirect costs associated with production.

Step 2: Determine the Value or Price of Outputs
The value or price of outputs is the amount for which the product or service is sold. This could be the retail price, wholesale price, or any other price at which the product or service is sold to the end customer.

Step 3: Subtract the Cost of Inputs from the Value or Price of Outputs
The difference between the value or price of outputs and the cost of inputs is the economic profit or economic value added. If this value is positive, it means that the business is making a profit. If it's negative, it means that the business is operating at a loss.

For example, if a company spends $100 on inputs to produce a product and sells that product for $150, the economic profit is $50 ($150 - $100).

Knowee AI · Accepted Answer

The difference between the cost of inputs and the value or price of outputs is known as "economic profit" or "economic value added". Here's how you can calculate it:

Step 1: Determine the Cost of Inputs
The cost of inputs includes all the expenses incurred to produce a product or service. This could include raw materials, labor costs, overhead costs, and any other direct or indirect costs associated with production.

Step 2: Determine the Value or Price of Outputs
The value or price of outputs is the amount for which the product or service is sold. This could be the retail price, wholesale price, or any other price at which the product or service is sold to the end customer.

Step 3: Subtract the Cost of Inputs from the Value or Price of Outputs
The difference between the value or price of outputs and the cost of inputs is the economic profit or economic value added. If this value is positive, it means that the business is making a profit. If it's negative, it means that the business is operating at a loss.

For example, if a company spends $100 on inputs to produce a product and sells that product for $150, the economic profit is $50 ($150 - $100).

The difference between the cost of inputs and the value or price of outputs. ( disregard the dash; use space instead )

Question

The difference between the cost of inputs and the value or price of outputs.

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