cost, both in the short and long run. Private enterprise, which can be private individual or group business

ownership, characterizes the U.S. economy. In the U.S. system, we have the option to organize private

businesses as sole proprietorships (one owner), partners (more than one owner), and corporations (legal

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7.1 • Explicit and Implicit Costs, and Accounting and Economic Profit 159

entitles separate from the owners.

When people think of businesses, often corporate giants like Wal-Mart, Microsoft, or General Motors come to

mind. However, firms come in all sizes, as Table 7.1 shows. The vast majority of American firms have fewer

than 20 employees. As of 2010, the U.S. Census Bureau counted 5.7 million firms with employees in the U.S.

economy. Slightly less than half of all the workers in private firms are at the 17,000 large firms, meaning they
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