Suppose that a business incurred implicit costs of $400,000 and explicit costs of $3 million in a specific year. If the firm sold 100,000 units of its output at $40 per unit, its accounting:
A. profits were $1,000,000 and its economic profits were $600,000.
B. profits were $3,600,000 and its economic profits were $600,000.
C. losses were $600,000 and its economic losses were zero.
D. profits were $600,000 and its economic profits were $1,000,000.
Answer: A
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