Economic cost.

Question

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Answer 1

Question

Chapter 7, Problem 1RQ

To determine

Economic cost.

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.

Economics Concept Introduction

Economic cos t: An economic cost is a cost to a firm for utilizing economic resources in the production.

Accounting cost: An accounting cost is the actual expenses, plus depreciation charges for capital equipment.

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ECON 2106: Microeconomics I Fall - 2023 Algoma University Homework # 2 (Due: October 19, 2023) 1. The market demand for cashmere socks is given by Q = 1,000 + 0.5I – 400P + 200P’ Where, Q = Annual demand in number of pairs I = Average income I dollars per year P = Price of one pair of cashmere shocks P’ = Price of one pair of wool shocks Given that I = ECON 2106: Microeconomics I Fall - 2023 Algoma University Homework # 2 (Due: October 19, 2023) 1. The market demand for cashmere socks is given by Q = 1,000 + 0.5I – 400P + 200P’ Where, Q = Annual demand in number of pairs I = Average income I dollars per year P = Price of one pair of cashmere shocks P’ = Price of one pair of wool shocks Given that I = $20,000, P = $10, and P’ = $5, determine ƐQP, ƐQI, and ƐQP’.

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Answer 2

Question

Chapter 7, Problem 1RQ

To determine

Economic cost.

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.

Economics Concept Introduction

Economic cos t: An economic cost is a cost to a firm for utilizing economic resources in the production.

Accounting cost: An accounting cost is the actual expenses, plus depreciation charges for capital equipment.

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Answer 3

Question

Chapter 7, Problem 1RQ

To determine

Economic cost.

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.

Economics Concept Introduction

Economic cos t: An economic cost is a cost to a firm for utilizing economic resources in the production.

Accounting cost: An accounting cost is the actual expenses, plus depreciation charges for capital equipment.

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Answer 4

Question

Chapter 7, Problem 1RQ

To determine

Economic cost.

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.

Economics Concept Introduction

Economic cos t: An economic cost is a cost to a firm for utilizing economic resources in the production.

Accounting cost: An accounting cost is the actual expenses, plus depreciation charges for capital equipment.

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Answer 5

Chapter 7, Problem 1RQ

To determine

Economic cost.

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.

Economics Concept Introduction

Economic cos t: An economic cost is a cost to a firm for utilizing economic resources in the production.

Accounting cost: An accounting cost is the actual expenses, plus depreciation charges for capital equipment.

Answer 6

Chapter 7, Problem 1RQ

To determine

Economic cost.

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.

Economics Concept Introduction

Economic cos t: An economic cost is a cost to a firm for utilizing economic resources in the production.

Accounting cost: An accounting cost is the actual expenses, plus depreciation charges for capital equipment.

Answer 7

Chapter 7, Problem 1RQ

To determine

Economic cost.

Answer 8

Expert Solution & Answer

Explanation of Solution

An explicit cost is a direct payment made to others in the production process which is also used to calculate the economic cost and accounting cost. In the given case, a payment of an annual retainer of $10,000 to the accountant is a direct payment. Therefore, it can be considered as an explicit cost. Therefore, it can be considered as both an economic cost and an accounting cost because since the monetary transaction exists in this payment it is called an accounting cost, whereas by paying the annual retainer of $10,000, the firm purchases the service of the accountant. Thus, it is also a cost of economic resources. Hence, the payment of an annual retainer of $10,000 to the accountant can be considered as an economic cost.