Question : Capital employed by a firm is Rs.5,00,000. Its average profit is Rs.60,000. The normal rate of return in similar type of business is 10%. The amount of super profits is:
Option 1: Rs.50,000
Option 2: Rs.10,000
Option 3: Rs.6,000
Option 4: Rs.56,000
Correct Answer: Rs.10,000
Solution : Normal Profit = Capital employed X Normal rate of return = Rs.5,00,000 X 10% = Rs.50,000 Average Profit = Rs.60,000 Super Profit = Average Profit - Normal Profit = Rs.60,000 - Rs.50,000 = Rs.10,000 Hence, the correct option is 2.
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