Given below are two statements, one is labelled as Assertion A and the other is labelled as Reason R
Assertion A: Economic profit is smaller than accounting profit.
Reason R: Accounting profit = Revenue - Explicit costs Economic Profit = Revenue - Explicit costs - Implicit costs
In light of the above statements, choose the correct answer from the options given below
1
Both A and R are true and R is the correct explanation of A
2
Both A and R are true but R is NOT the correct explanation of A
3
A is true but R is false
4
A is false but R is true