8 sionsLisa quit her $40,000- per- year job to start her own economics consulting firm. Atthe end of her first year of operation, her total revenues were $150,000. Her totaluncementsexplicit costs were $108,00O. What was her economic profit for the year?nmentsulesO $42,000O $2,000O $0O $48,000Next« Previous21 O28otvPMacBook Pro

Explicit cost is the actual monetary spending. Implicit cost is the opportunity cost of doing a activity. ------------- Lisa quits her $40,000 per year job to start her own economic consulting firm. So, the opportunity cost of starting an economic consulting firm is $40,000 Hence, the implicit cost is $40,000 ----------------- Explicit cost is $108,000 Total revenue is $150,000 -------------------Economic profit = Total revenue - Explicit cost - Implicit cost => Economic profit = $150,000 - $108,000 - $40,000 => Economic profit = $2000 Answer: Option (B), i.e., $2000

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Lisa quit her $40,000- per- year job to start her own economics consulting firm. At the end of her first year of operation, her total revenues were $150,000. Her total explicit costs were $108.000. What was her economic profit for the year? O $42,000 O $2,000

Lisa quit her $40,000- per- year job to start her own economics consulting firm. At the end of her first year of operation, her total revenues were $150,000. Her total explicit costs were $108.000. What was her economic profit for the year? O $42,000 O $2,000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

sions
Lisa quit her $40,000- per- year job to start her own economics consulting firm. At
the end of her first year of operation, her total revenues were $150,000. Her total
uncements
explicit costs were $108,00O. What was her economic profit for the year?
nments
ules
O $42,000
O $2,000
O $0
O $48,000
Next
« Previous
21 O
28
otv
P
MacBook Pro

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