How profits differ from rewards of other factors? What the entrepreneur receives in return of his function Is called profit. Profit is difference between total revenue and total cost. This profit is called gross profit.
Literally profits means the reward paid for the services of the entrepreneur who is scarce in supply. Net profit or economic profit or pure profit is a part of gross profit. Net profit may be zero or negative. Net profit = Gross profit – implicit cost. Net profit is the exclusive reward for the entrepreneurial function.