ECONOMICS W/CONNECTPLUS PKG>IC<
20th Edition
ISBN: 9781259685897
Author: McConnell
Publisher: MCG CUSTOM
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Chapter 9, Problem 2DQ
To determine
Accounting profit, economic profit and normal profit in resource allocation.
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LO 11.2: I can calculate marginal cost, revenue, and profit and distinguish between marginal cost
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Suppose that Patrick's Handmade Puppets has a production cost that is given by
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Linda sells 100 bottles of homemade ketchup for $10 each. The cost of the ingredients, the bottles, and the labels was $700. In addition, it took her 20 hours to make the ketchup and to do so she took time off from a job that paid her $20 per hour. Linda’s accounting profit is while her economic profit is. LO9.1 a. $700; $400 b. $300; $100 c. $300; negative $100 d. $1,000; negative $1,100
The following figure shows the revenue and cost curves for a firm X.
RM
10
a.
b.
C.
7
6
LO
5
4
3.5
0
20 25 30
MC
40
AVC
AC
AR=MR
Units
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If the market price is RM4.00, what is the total profit or total loss.
Chapter 9 Solutions
ECONOMICS W/CONNECTPLUS PKG>IC<
Ch. 9.2 - Prob. 1QQCh. 9.2 - Prob. 2QQCh. 9.2 - Prob. 3QQCh. 9.2 - Prob. 4QQCh. 9.5 - Prob. 1QQCh. 9.5 - Prob. 2QQCh. 9.5 - Prob. 3QQCh. 9.5 - Prob. 4QQCh. 9.8 - Prob. 1QQCh. 9.8 - Prob. 2QQ
Ch. 9.8 - Prob. 3QQCh. 9.8 - Prob. 4QQCh. 9 - Prob. 1DQCh. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - Prob. 4DQCh. 9 - Prob. 5DQCh. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 1RQCh. 9 - Which of the following are short-run and which are...Ch. 9 - Prob. 3RQCh. 9 - Prob. 4RQCh. 9 - Prob. 5RQCh. 9 - Prob. 6RQCh. 9 - Prob. 1PCh. 9 - Prob. 2PCh. 9 - Prob. 3PCh. 9 - Prob. 4P
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- If You are the owner and only employee of a company that writes computer software that is used by gamblers to collect sports data. Last year you earned a total revenue of $90,000. Your costs for equipment, rent, and supplies were $60,000. To start this business you invested an amount of your own capital that could pay you a return of $40,000 a year. then your economic profit is Select one: a. 10,000 O b.-10,000 O c. -40,000 O d. 20,000 O e. 40,000arrow_forwardAndrea starts her own business, which earns $75,000 in accounting profit in the first year. When deciding to open the business, Andrea withdrew $10,000 from savings, which earned 5 percent interest. Andrea also turned down three separate job offers with annual salaries of $45,000, $55,000, and $65,000. What is Andrea's economic profit from this business? O a. $0 O b. $-500 O c. $9,500 O d. $65,000 O e. none of the abovearrow_forwardRefer to the table below. Note that the first column shows variable costs. Quantity Cost Fixed Total Average Average Variable (in dollars) Costs Costs Total Costs Costs (in dollars per 0 1 2 3 4 LO 5 6 0 15 35 60 90 125 160 (in (in (in dollars unit) dollars) dollars) per unit) 40 40 40 40 55 75 37.5 40 100 33.3 40 130 32.5 40 165 33 40 200 33.3 : 15 17.5 20 22.5 25 26.6 Marginal Costs (in dollars per unit) : 15 20 25 30 35 a If the firm produces 5 units that it sells at a price of $30.00 each, what will its profits or losses equal? losses equal $15 profts equal $15 profts equal $25 losses equal $25arrow_forward
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