Why should the normal profits be included as part of a firm's costs?

Normal profit is counted as the cost of business. This generally means the normal profit obtained from the business can be used as the total cost for running the other business. If a firm does not receive normal profit from a business then, it will be difficult for the firm to maintain the other businesses.

Normal profit also keeps the firm to maintain its day-to-day operations. If the firm is no longer able to earn from normal profit, then in the long run, the firm has to close down their business activities. Therefore, to maintain the day-to-day operation, the firm has to earn a normal profit. That's why economists believe that normal profit is treated as firm's cost.