Words / E / Business

economic profit

noun/ˌiːkəˈnɒmɪk ˈprɒfɪt/

C2CEFR level
78/100Rarity: rare
TechnicalRegister

The surplus remaining after the full cost of capital is deducted from operating profit.

Despite reporting accounting gains, the division generated no economic profit once its capital charge was applied.

Similar: economic value added, residual income

Topic: Finance in Business English

Rarity runs from 0 (a word everyone knows) to 100 (almost never seen outside specialist or literary writing). Level is the word's real difficulty on the CEFR scale, from A1 to C2.

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