Question

N Norman Dowd owns his own taxi, for which he bought a $11900 permit to operate two years ago M Dowd earns $15.700 a year operating as an independent but has the opportunity to sell the taxi and permit for $46,000 and take a position as dispatcher for Carter Taxi Co. The dispatcher position pays $37000 a year for a 40-hour week. Driving his own taxl Mr Dowd works approximately 55 hours per week wheses his business, he will invest the $46000 and can earn a 11 percent return Required . - Old Determine the opportunity cost of owning and operating the independent business b. Calculate the comings of Norman Dowd operating as an independent and the earnings of Norman Dowd working as a dispatcher Based solely on financial considerations should Mi Dowd sell the tax and accept the position as dispatcher < Prev 2 of 5 ! Ne > Type here to search o e e o wERTY А. zxcvBNIM

Answer 1

Answer is given below

a) Opportunity cost $46,000.00 Operating as an Independent Working as a dispatcher ($37,000 + 11% of $46,000) $35,700.00 $42,060.00 Based on above working since Income is higher as a dispatcher Mr. Dowd should sell the taxi and accept the position as a dispatcher