Homework Answers
A) Explicit costs = wages+costs of supplies,utilities = 165000+75000+45000 = 285000
B) Implicit costs = interest forgone+forgone rent+forgone salary = 5000+54000+95000 = 154000
C) Accounting profit = total revenue - explicit costs = 650000-285000 = 365000
D) Economic profit = accounting profit - implicit costs = 365000-154000 = 211000
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Show me the formulas for explicit cost, implicit cost,
accouting profit, and economic profit. Tell me...
Show me the formulas for explicit cost, implicit cost, accouting profit, and economic profit. Tell me what to do for pr...
Show me the formulas for explicit cost, implicit cost,
accouting profit, and economic profit. Tell me what to do for
problems a-d.
ASSUME THAT YOU OWN AN ENGINEERING FIRM THAT HAS THE FOLLOWING COST AND REVENUE INFORMATION FOR LAST YEAR: ........ -total revenue from operations $650,000 $650, 165,000 -wages of clerks and assistants -$100,000 of your money is invested in the firm; it could earn 5% interest if invested elsewhere (.05 x $100,000) . 5,000 -cost of inventory, supplies, and...
During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor...
During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor expense, raw materials, rent, and utilities. The firm's owner has provided $750,000 of her own money form her personal portfolio instead of investing the money and earning a 10% annual rate of return. The firm also operates out of a building they own worth $1,000,000 which the owner inherited 25 years ago. The explicit costs of the firm are $______________. If the owner could...
If a firm generates $200,000 in revenue, earns $105,000 in economic profit, and its explicit costs...
If a firm generates $200,000 in revenue, earns $105,000 in economic profit, and its explicit costs are $90,000, how much are its implicit costs? $105,000 $30,000 $90,000 $5,000 $200,000
Question 1: Determine whether the following expense is explicit or implicit A firm makes a rent...
Question 1: Determine whether the following expense is explicit or implicit A firm makes a rent payment to a landlord for retail space. Implicit Costs Explicit Costs points Print Question 2: A firm has provided you with the following information: Total Revenue $700 Implicit Costs $450 Explicit Costs $50 What is the firm's accounting profit? $ What is the firm's economic profit? $ Question 3: An industry is said to be in the long-run when: all prices have become variable....
HANDOUT ABOUT PRODUCTION -CH Z Note: An explicit cost is a cost paid in money. An...
HANDOUT ABOUT PRODUCTION -CH Z Note: An explicit cost is a cost paid in money. An implicit cost is an opportunity cost incurred by a firm when it uses a factor of production for which it does not make a direct money payment Normal profit is the return to entrepreneurship. The normal profit is part of a firm's opportunity cost because it is the cost of persuading the entrepreneur of not running another business. Chapter 7 Handout. Question 2: In...
5. A. Explain why explicit costs and implicit costs are relevant in economic decision B. You...
5. A. Explain why explicit costs and implicit costs are relevant in economic decision B. You have just been offered a job in a firm at Wall Street paying $60,000 per making. year. You decide to turn down this offer because you want to work for yourself. Explain the opportunity cost of working for yourself? C. Analyze why the marginal cost is the relevant cost to the producer when he is deciding whether to produce more of a good.
Question 11 Economic profit equals total revenue minus total costs including explicit fixed costs, explicit variable...
Question 11 Economic profit equals total revenue minus total costs including explicit fixed costs, explicit variable costs, implicit fixed costs, and implicit variable costs. True False Question 12 4 pt If Economic profit equals zero, then the firm should shut down in the short run and go out of business in the long run. True e False The period of time long enough to allow a firm to vary all of its inputs, to adopt new technology, and to increase...
$ 27,000 Total (gross) revenues per month less explicit costs: Cost of merchandise sold Wages to...
$ 27,000 Total (gross) revenues per month less explicit costs: Cost of merchandise sold Wages to cashier, stock, and delivery help Rent and utilities Taxes Total explicit costs Accounting profit (revenue minus explicit costs) less implicit costs: Wages of owner-manager, 300 hours @ $10 per hour Return on inventory investment, 10% per year on $120,000 Total implicit costs Economic profit (revenue minus all costs) $ 17,000 2,500 800 700 $ 21,000 $ 6,000 $ 3,000 1,000 $ 4,000 $ 2,000...
Microeconomics Chapter 9. Name Emili 1. Economic cost can best be defined as any contractual obligation...
Microeconomics Chapter 9. Name Emili 1. Economic cost can best be defined as any contractual obligation that results in a flow of money expenditures resource suppliers. B. those payments for resources that involve an obvious cash transaction. C. the income the firm must provide to resource suppliers to attract ri uses. D. the opportunity cost of using a resource already owned by the firm. 2. Which of the following is most likely to be an implicit cost for C (A)....
ANSWERS MUST BE CLEAR TO READ! THANKS! SHOW ALL YOUR CALCULATIONS FOR ACCOUNTING AND ECONOMIC PROFIT!...
ANSWERS MUST BE CLEAR TO READ! THANKS! SHOW ALL YOUR
CALCULATIONS FOR ACCOUNTING AND ECONOMIC PROFIT!
Kenji lives in Houston and runs a business that sells pianos. In an average year, he receives $704,000 from selling pianos. Of this sales revenue, he must pay the manufacturer a wholesale cost of $404,000; he also pays wages and utility bills totaling $286,00o. He owns his showroom; if he chooses to rent it out, he will receive $3,000 in rent per year. Assume...
Show me the formulas for explicit cost, implicit cost,
accouting profit, and economic profit. Tell me what to do for
problems a-d.
ASSUME THAT YOU OWN AN ENGINEERING FIRM THAT HAS THE FOLLOWING COST AND REVENUE INFORMATION FOR LAST YEAR: ........ -total revenue from operations $650,000 $650, 165,000 -wages of clerks and assistants -$100,000 of your money is invested in the firm; it could earn 5% interest if invested elsewhere (.05 x $100,000) . 5,000 -cost of inventory, supplies, and...
Question 1: Determine whether the following expense is explicit or implicit A firm makes a rent payment to a landlord for retail space. Implicit Costs Explicit Costs points Print Question 2: A firm has provided you with the following information: Total Revenue $700 Implicit Costs $450 Explicit Costs $50 What is the firm's accounting profit? $ What is the firm's economic profit? $ Question 3: An industry is said to be in the long-run when: all prices have become variable....
HANDOUT ABOUT PRODUCTION -CH Z Note: An explicit cost is a cost paid in money. An implicit cost is an opportunity cost incurred by a firm when it uses a factor of production for which it does not make a direct money payment Normal profit is the return to entrepreneurship. The normal profit is part of a firm's opportunity cost because it is the cost of persuading the entrepreneur of not running another business. Chapter 7 Handout. Question 2: In...
5. A. Explain why explicit costs and implicit costs are relevant in economic decision B. You have just been offered a job in a firm at Wall Street paying $60,000 per making. year. You decide to turn down this offer because you want to work for yourself. Explain the opportunity cost of working for yourself? C. Analyze why the marginal cost is the relevant cost to the producer when he is deciding whether to produce more of a good.
Question 11 Economic profit equals total revenue minus total costs including explicit fixed costs, explicit variable costs, implicit fixed costs, and implicit variable costs. True False Question 12 4 pt If Economic profit equals zero, then the firm should shut down in the short run and go out of business in the long run. True e False The period of time long enough to allow a firm to vary all of its inputs, to adopt new technology, and to increase...
$ 27,000 Total (gross) revenues per month less explicit costs: Cost of merchandise sold Wages to cashier, stock, and delivery help Rent and utilities Taxes Total explicit costs Accounting profit (revenue minus explicit costs) less implicit costs: Wages of owner-manager, 300 hours @ $10 per hour Return on inventory investment, 10% per year on $120,000 Total implicit costs Economic profit (revenue minus all costs) $ 17,000 2,500 800 700 $ 21,000 $ 6,000 $ 3,000 1,000 $ 4,000 $ 2,000...
Microeconomics Chapter 9. Name Emili 1. Economic cost can best be defined as any contractual obligation that results in a flow of money expenditures resource suppliers. B. those payments for resources that involve an obvious cash transaction. C. the income the firm must provide to resource suppliers to attract ri uses. D. the opportunity cost of using a resource already owned by the firm. 2. Which of the following is most likely to be an implicit cost for C (A)....
ANSWERS MUST BE CLEAR TO READ! THANKS! SHOW ALL YOUR
CALCULATIONS FOR ACCOUNTING AND ECONOMIC PROFIT!
Kenji lives in Houston and runs a business that sells pianos. In an average year, he receives $704,000 from selling pianos. Of this sales revenue, he must pay the manufacturer a wholesale cost of $404,000; he also pays wages and utility bills totaling $286,00o. He owns his showroom; if he chooses to rent it out, he will receive $3,000 in rent per year. Assume...
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