Finance Formulas / July 17, 2018 / Alyvia French
Economic profit is the difference between the revenue a firm earns from sales and the firm’s total opportunity costs. It’s important to distinguish between accounting profit and economic profit. Accounting profit is total revenue minus the explicit costs of producing goods or services. Explicit costs are things like raw materials and employee wages. This is what most people are referring to when they talk about profit.
Coupon bonds are rare since most modern bonds are not issued in certificate or coupon form. Instead, bonds are formed electronically, though some holders still prefer to own paper certificates. For this reason, the coupon bond simply refers to the rate it projects rather than its physical nature in the form of certificates or coupons.
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