What term refers to the positive return on an investment after accounting for all costs?

Prepare for the Loss Prevention Qualification Certification Exam. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

The term that refers to the positive return on an investment after accounting for all costs is Economic Profit. Economic profit goes beyond just net revenue and takes into consideration both explicit costs (out-of-pocket expenses) and implicit costs (the opportunity costs of using resources elsewhere). This allows for a more accurate representation of the true profitability of an investment, as it assesses the profitability relative to the potential returns that could have been earned if the resources were allocated differently.

In contrast, while net profit also indicates profitability, it may not account for these implicit costs, thus potentially overstating the true financial benefit of the investment. Gross income refers to total revenue before any costs are deducted, and return on investment typically measures the gain or loss generated relative to the investment cost, but may not factor in all forms of cost comprehensively like economic profit does. Understanding these distinctions emphasizes the importance of evaluating all factors involved in an investment to determine its true profitability.

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