Question

Gumez runs a small pottery firm he hires one helper at $12,000 per year, pays annual rent of $5,000 for his shop, and spends $20,000 per year on material. He has $4,0,000 of his own founds invested in equipments that could earn him $4000 per year if alternatively invested. He has been offered $15,000 per year to work as a potter for a compertoir. H estimates his entre talent are worth $3000 per year. total annual revenue from pottery sale is #72,000.

Calculate the accounting profit and the economic profit for Gomez's pottery firm

Expert Solution

Want to see the full answer?

Check out a sample Q&A here
Blurred answer
Students who’ve seen this question also like:
Survey Of Economics
Survey Of Economics
10th Edition
ISBN: 9781337111522
Author: Tucker, Irvin B.
Publisher: Cengage,
Not helpful? See similar books
Survey Of Economics
Survey Of Economics
Proudction Costs. 8SQP
marketing sidebar icon
Want to see this answer and more?
Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*
*Response times may vary by subject and question complexity. Median response time is 34 minutes for paid subscribers and may be longer for promotional offers.

Related Economics Q&A

Find answers to questions asked by students like you.

Q: Gomez runs a small pottery firm. He hires one helper at $11,500 per year, pays annual rent of $7,000…

A: Click to see the answer

Q: AI Maha company has 25% scraprate. It produces 2500 units in a ten-hour day. The units are produced…

A: Multifactor productivity (MFP) is a measure of economic performance that compares the amount of…

Q: Mr. Afzal runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of…

A: Profit: It is a pay circulated to the proprietor in a beneficial market creation measure. Benefit is…

Q: Gomez runs a small pottery firm.he hires one helper at $14,500 per year, pays annual rent of $7,500…

A: Click to see the answer

Q: Gomez runs a small pottery firm. He hires one helper at $11,500 per year, pays annual rent of $7,000…

A: Accounting profit is the net income for a company, which is revenue minus expenses. Economic profit…

Q: 6 Ahmed's Pizza House sells extra-large deluxe pizzas at OMR 9.000 per pizza. The cost of…

A: Answer - Given in the question - Price of extra-large Deluxe pizza = OMR 9.00 Cost of Ingredients to…

Q: Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of $5000…

A: Explicit costs are the expenditures incurred by an individual or a business out of its own pockets.…

Q: Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of $5000…

A: Profits is calculated as the difference between total revenue and total cost. In economics, total…

Q: Dan wants to expand his business and use the 5 acre property he owns and rents to a local cattle…

A: Implicit cost refers to the opportunity cost of resources, which are owned by the firm or an…

Q: Q1: Usher Dash is president of Dash Manufacturing, a producer of Go-Kart tires. Dash makes 870,000…

A: Productivity of an input refers to the amount of goods produced by the single unit of input. Labor…

Q: 61. The average total cost pf producing 50 units is Rs.250 and total fixed cost is Rs.1000. What is…

A: Total Fixed Cost =1000 Average Fixed Cost =Total Fixed CostOutput…

Q: You run a business selling used hand tools. The rent on your building is $1400/month. Utilities…

A: The average selling price (ASP) is a term that refers to the average price a good or service is sold…

Q: 61. The average total cost pf producing 50 units is Rs.250 and total fixed cost is Rs.1000. What is…

A: There are basically two types of costs i.e. fixed costs and variable costs. Fixed costs remain…

Q: 61. The average total cost pf producing 50 units is Rs.250 and total fixed cost is Rs.1000. What is…

A: Given: The average total cost of producing 50 units is = Rs250 The total fixed cost is = Rs1,000 To…

Q: Q3. Complete the following cost table given below and additionally state all the formulae used:…

A: TC is the total expenditure incurred in the production of total output. TC is the sum of fixed and…

Q: exter set up a computer repair business out of his home office. Based on the square footage of his…

A: Fixed cost for payment of mortgage expenses =$400 per month  Monthly internet bill =$45 Monthly…

Q: Given the production and cost schedule for Laso Factory for tapes.Assuming that capital is the only…

A: A fixed cost is a cost that does not change with the change in the production of goods and services.…

Q: QUESTION 48 A fem has a Total Cost of $1000, of which $300 is Fixed Cost. If the firm a currently…

A: Average Cost is the per unit cost , here we calculate the AVC by using the given information and…

Q: Gomez runs a small pottery firm. He hires one helper at $12000 per year, pays annual rent of $5000…

A: Accounting profit is the net profit of a firm which is total revenue minus explicit costs. Economic…

Q: Assume Texas instruments company purchased inputs costing $15,000, paid wages to their workers…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Input Product Product Product 14 7.0 15 24 32 39 7.5 8.0 12 3 4 8.0 10 5 7.8 45 7.5 50 7.1 Jaing the…

A: LABOR INPUT TOTAL PRODUCT MARGINAL PRODUCT AVERAGE PRODUCT 1 7 7 7.0 2 15 8 7.5 3 24 9 8.0 4…

Q: The sole proprietor of the "Books and More" bookstore receives all accounting profits earned by her…

A: The firms and businesses operate in the market with the motive of earning high level of profits, and…

Q: 70. Total costs in the short-term are classified into fixed costs and variable costs. Which one of…

A: Total cost includes all the costs incurred for producing the product.

Q: Molowing statoments is true? O An explicit cost is more important, dolar for dollar, than an…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: Answer saved What is the average variable cost? Marked out of 2 P Flag question Select one: O a. AVC…

A: Click to see the answer

Q: Kim Hanson has just finished his first year as owner and manager of a new restaurant. His revenues,…

A: Answer - Thank you for submitting the question but we are autorized to solve three sub parts…

Q: Using the following assumptions calculate the marginal cost of both a simple cycle and combined…

A: Answer - "thank you for submitting the question.But, we are authorized to solve only 3 subparts.…

Q: Ahmed's Pizza House sells extra-large deluxe pizzas at OMR 9.000 per pizza. The cost of ingredients…

A: Total cost includes total fixed cost(TFC) and total variable cost(TVC). Total fixed costs are the…

Q: putput is Cost schedule Total vari- Labor Output (units per day) Total cost (dollars) able cost…

A: Click to see the answer

Q: The 2nd unit of a 10-unit job took nine hours to complete. The 6th unit has been worked on for two…

A: To calculate the time required for any number of units using the following formulaTn = T1 x unit…

Q: Fillipe quit his old job where he had been earning $2,000 a month to start his own business. He also…

A: Salary = 2,000 Income from business = 1,000

Q: William Howe must decide whether to start a business renting beach umbrellas at an ocean resort…

A: Profit is the percentage by which a company's earnings exceed its costs for a specified period of…

Q: Calculate the multifactor productivity in dollars per dollar for the following: 6660 units produced,…

A: Multifactor productivity is the measurement that compares the output with the total amount of inputs…

Q: 6 Ahmed's PIzza House sells extra-large deluxe pizzas at OMR 9.000 per pizza. The cost of…

A: Given,  Selling Cost of extra-large deluxe pizza = OMR 9 per pizza Cost of ingredients = OMR 2 per…

Q: Jack decides to quit his job paying $28,000 a ycar and start his own business manufacturing and…

A: Explicit Costs are those costs which are incurred while conducting business operations. Implicit…

Q: What is the impartance of eatimating the aver age Cost, Tatal Cast . average Fixed Cast, tatal…

A: The firms, and businesses are the entities which are considered to be important contributors to the…

Q: abour                    total product 0                             0  1…

A: "Factors of production are resources that are used to produce a good or service." There are various…

Q: During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor…

A: Hi student, thanks for posting the question. As per the guideline, we are providing answer for the…

Q: During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor…

A: It is given that,Firms’ Revenue = $450, 000Firms’ Explicit Cost (Expense on labor, raw material,…

Q: During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor…

A: Hey, thank you for the question, since there is multiple question posted, according to our policy we…

Q: Mr. R is working from7:30 AM to 3:30PM including lunch break for 5 days every week in jewelry design…

A: [Since more than 1 question are posted, only 1st one is answered as per answering policy]…

Q: Inder which of the folowing axamples is tlikaly that the accounting profit is positive and the…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: Last year Doreen's Dairy earned a total revenue of $42 thousand from selling 7 thousand pounds of…

A: The provided information are: Variable cost = $28 thousand Total cost = $40 thousand

Q: Your friend Sarah is planning to open a hardware store. She estimates that it would cost $50,000…

A: Here, given information is: Direct cost on rent and inventory: $50,000 each month Implicit cost…

Q: Your uncle is thinking about opening a wine bar. He estimates that it would cost $400000 per year to…

A: Total cost = 400000 $ Accounting profit  = TR – TC = 600000  - 400000 = 200000 $ Economic profit =…

Q: A young chef is considering opening his own sushi bar. To do so, he would have to quit his current…

A: Implicit cost is the opportunity cost.

Q: Explicit costs are and implicit costs are O Paid in money; incurred when a firm gives up an…

A: A paid in money and secondly it is incurred in giving up the alternate action. Explicit costs are…

Q: antity Total Cost Marginal Cost Fixed Cost Variable Cost Average Variable Cost Average Total Cost…

A: TC = FC + VC VC = TC - FC MC = (TC2 - TC1)/(Q2 - Q1) AVC = VC / Q ATC = TC / Q

Q: A firm have fixed cost of 70$ and a variable cost as indicated in the table. complete the table…

A: We have given a table in which variable cost (TVC) is mentioned and the total fixed cost is 70 We…

Knowledge Booster
Economics
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
  • Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of $5000 for his shop, and spends $20,000 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $4000 per year if alternatively invested. He has been offered $15,000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $3000 per year. Total annual revenue from pottery sales is $72,000. Calculate the accounting profit and the economic profit for Gomez’s pottery firm.
    Andie is considering leaving her job as attorney to pursue her passion by starting a dog grooming business. She currently takes home $6000 per month from her job. She pays $2000 per month to rent her house . if she were to start the dog grooming business, she  would operate it out of the currently unused room at the back of her house and she would work at it fulltime. She would hire additional  workers and pay them a total of$3000 per month , while spending $1000 per month on materials . she already has everything else she needs to start the business. What are the monthly economic costs of Andies potential dog grooming business.
    Dexter set up a computer repair business out of his home office. Based on the square footage of his office, he allocates a fixed cost of $400 per month in mortgage expenses. He also has a monthly internet bill of $45 and a monthly phone bill of $35. While repairs vary greatly, Dexter estimates an average of $19 in expenses per repair and charges a flat $49 fee per repair for his labor.                      3a. How many computers does Dexter need to repair each month to break even?__________3b. What is Dexter’s profit / loss if he only repairs 8 computers in a month?__________3c. What fee would Dexter need to charge to break even at 8 repairs?
  • Yverrry is earning $200,000 per year as medical sales representafive. Due to the covid pandemic, she decided to open a small restaurantin the City where she lives. She invested $200,000 of his savings that has been eaming $5,000 interest per year. Since there was vacant space in the area where she lives, she decided to use this lot to put up his restaurant. The lot has been earning $10,000.00 annually as it is beingrented as a parking space for the executives in the nearby Firm. She hired one (1) clerk and 3 helpers who will help him in the restaurant. Water and electricity bills for the year reached $50,000.00. Yverry will be paying the clerk $3,000.00 while the 3 helpers $2,500.00 each monthly. Affer a year of operation, Yverry was able to earn a sales revenue of $800,000.00 Required: Compute for the Yverry's accounting and economic profit.
    Gomez runs a small pottery firm. He hires one helper at $12000 per year, pays annual rent of $5000 for his shop and spends $20000 per year on materials. He has $40000 of his own funds invested in equipment that could earn him $4000 per year if alternatively invested. he has been offered $15000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $3000 per year. Total annual revenue from pottery sales is $72000. calculate the accounting profit and economic for Gomez pottery firm.
    Your aunt is thinking about opening a hardware store. She estimates that it would cost $500,000 per year to rent the location and buy the stock. In addition, she would have to quit her $50,000 per year job as an accountant. Your aunt’s opportunity costs comprise *the accounting costs.the accounting costs and the implicit costs.all economic costs.none of the above Referring to the problem above: The implicit cost/s that your aunt can incur is/are: *foregone rental value, foregone interest income, foregone wages.foregone rental value and foregone wagesforegone interest income and foregone wagesforegone wages.
    • SEE MORE QUESTIONS
    Recommended textbooks for you
  • Survey Of Economics
    Economics
    ISBN:9781337111522
    Author:Tucker, Irvin B.
    Publisher:Cengage,
    Economics For Today
    Economics
    ISBN:9781337613040
    Author:Tucker
    Publisher:Cengage Learning
    Micro Economics For Today
    Economics
    ISBN:9781337613064
    Author:Tucker, Irvin B.
    Publisher:Cengage,
  • Managerial Economics: Applications, Strategies an...
    Economics
    ISBN:9781305506381
    Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
    Publisher:Cengage Learning
    Principles of Microeconomics
    Economics
    ISBN:9781305156050
    Author:N. Gregory Mankiw
    Publisher:Cengage Learning
    Microeconomics: Principles & Policy
    Economics
    ISBN:9781337794992
    Author:William J. Baumol, Alan S. Blinder, John L. Solow
    Publisher:Cengage Learning
  • Survey Of Economics
    Economics
    ISBN:9781337111522
    Author:Tucker, Irvin B.
    Publisher:Cengage,
    Economics For Today
    Economics
    ISBN:9781337613040
    Author:Tucker
    Publisher:Cengage Learning
    Micro Economics For Today
    Economics
    ISBN:9781337613064
    Author:Tucker, Irvin B.
    Publisher:Cengage,
    Managerial Economics: Applications, Strategies an...
    Economics
    ISBN:9781305506381
    Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
    Publisher:Cengage Learning
    Principles of Microeconomics
    Economics
    ISBN:9781305156050
    Author:N. Gregory Mankiw
    Publisher:Cengage Learning
    Microeconomics: Principles & Policy
    Economics
    ISBN:9781337794992
    Author:William J. Baumol, Alan S. Blinder, John L. Solow
    Publisher:Cengage Learning