#Short selling profit calculator professional

It's easy to see how the implicit cost may change your decision about opening your business. Thus, the economic profit definition is the part of the revenue which is greater than the sum of explicit and implicit costs. Therefore, the total cost you need to consider is the sum of your explicit and implicit costs, which is the total opportunity cost, including both the cost of the resource (explicit) and the cost of giving up the best alternative use of the resource (implicit). Therefore, for every hour you work as an ice cream seller, you would give up this 100 dollars of income, which is also part of your cost: it's an implicit cost.

#Short selling profit calculator professional

Let's suppose you are also a professional programmer, and your hourly wage at your previous job was 100 dollars.

There are, however, other costs that might be less obvious. You can measure these costs, called explicit costs, easily as they take the form of real money. This includes the cost of the ice cream machine, the price of leasing out (or buying) the shop, and the various ingredients you will use. Calculating the total revenue in such a case is relatively simple: you need to multiply the number of ice creams sold by their prices over a given period.Īs you might think, profit is part of the revenue – that is, the revenue that remains after paying out all the costs. Let's consider, for example, you're thinking about setting up an ice cream shop. If you've ever thought about setting up a business, one of the first questions you ask yourself is probably, 'What would be my profit?' There are two crucial elements of profit: revenue and cost.