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A firm sells 100 units at a price of Rs 12 with average cost Rs 9. Its economic profit is
ARs 300
BRs 900
CRs 1,200
DRs 2,100
Answer & Solution
Correct answer: A. Rs 300
Profit equals output times the gap between price and average cost, so 100 x (12 - 9) = Rs 300.
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