Last year, Jarod left a job that pays $80,000 to run his own bike repair shop. Jarod's shop charges $65 for a repair, and last year the shop performed 5,000 repairs. Jarod's production costs for the year included rent, wages, and equipment. Jarod spent $60,000 on rent and $120,000 on wages for his employees. Jarod keeps whatever profit the shop earns but does not pay himself an official wage. Jarod used $30,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 4 percent. Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. a. What is Jarod's annual accounting profit? $ b. What is Jarod's annual economic profit?
Last year, Jarod left a job that pays $80,000 to run his own bike repair shop. Jarod's shop charges $65 for a repair, and last year the shop performed 5,000 repairs. Jarod's production costs for the year included rent, wages, and equipment. Jarod spent $60,000 on rent and $120,000 on wages for his employees. Jarod keeps whatever profit the shop earns but does not pay himself an official wage. Jarod used $30,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 4 percent. Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. a. What is Jarod's annual accounting profit? $ b. What is Jarod's annual economic profit?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Last year, Jarod left a job that pays $80,000 to run his own bike repair shop. Jarod's shop charges $65 for a repair, and last year the
shop performed 5,000 repairs. Jarod's production costs for the year included rent, wages, and equipment. Jarod spent $60,000 on
rent and $120,000 on wages for his employees. Jarod keeps whatever profit the shop earns but does not pay himself an official wage.
Jarod used $30,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 4 percent.
Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (-) in
front of those numbers.
a. What is Jarod's annual accounting profit?
$
b. What is Jarod's annual economic profit?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F20ef2402-9827-4c54-80da-90ee7dcb4860%2F346cc117-ce5d-4201-a025-d12c018745fd%2Fmkr1vnd_processed.png&w=3840&q=75)
Transcribed Image Text:Last year, Jarod left a job that pays $80,000 to run his own bike repair shop. Jarod's shop charges $65 for a repair, and last year the
shop performed 5,000 repairs. Jarod's production costs for the year included rent, wages, and equipment. Jarod spent $60,000 on
rent and $120,000 on wages for his employees. Jarod keeps whatever profit the shop earns but does not pay himself an official wage.
Jarod used $30,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 4 percent.
Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (-) in
front of those numbers.
a. What is Jarod's annual accounting profit?
$
b. What is Jarod's annual economic profit?
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