Concepts of Profit:
1. Gross Profit: Gross Profit is the surplus that accrues to a firm when it subtracts its Total expenditure from its Total Revenue.
Gross Profit = Total Revenue – Total cost
2. Net profit or Pure Profit or Economic Profit or True Profit: Net or pure or economic or true profit is the residual left with entrepreneur after deducting from Gross profit The remuneration for the selfowned factors of production which are called implicit cost.
Net Profit = Gross Profit – implicit costs.
3. Normal Profit: It refers to the minimum expected return to stay in business
4. Super Normal Profit: Super normal profits are over and above the normal profit.
Super Normal Profit = Actual profit – Normal profit
