QUESTION 6 Last year, Jarod left a job that pays $90,000 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 $65,000 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 $20,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 5 percent. What are Jarod's annual accounting and economic profits? O Jarod's annual accounting profit= $140,000 Jarod's annual economic profit= $49,000 O Jarod's annual accounting profit= $49,000 Jarod's annual economic profit= $140,000 O Jarod's annual accounting profit= $140,000 Jarod's annual economic profit= $139,000 O Jarod's annual accounting profit= $139,000 Jarod's annual economic profit= $30,000

QUESTION 6 Last year, Jarod left a job that pays $90,000 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 $65,000 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 $20,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 5 percent. What are Jarod's annual accounting and economic profits? O Jarod's annual accounting profit= $140,000 Jarod's annual economic profit= $49,000 O Jarod's annual accounting profit= $49,000 Jarod's annual economic profit= $140,000 O Jarod's annual accounting profit= $140,000 Jarod's annual economic profit= $139,000 O Jarod's annual accounting profit= $139,000 Jarod's annual economic profit= $30,000

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter14: Transaction Costs, Asymmetric Information, And Behavioral Economics

Section: Chapter Questions

Problem 5.11P

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