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DEFINITIONS

Abnormal profit

Definition

Abnormal profit, also referred to as supernormal profit or pure profit, is an economic term of profit exceeding the normal profit. Normal profit equals the opportunity cost of labour and capital, while abnormal profit exceeds the normal return from these input factors in production. In principle there are three kind of abnormal profit:

  • Monopoly rent
  • Resource rent
  • Intra marginal rent
RELATED TERMS
Abnormal returns



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