Charles has decided to open a lawn mowing company. To do so, he purchases mowing equipment for $4,000, buys gasoline ($1.50 in gas is required to mow each yard), and pays a helper $15.00 per yard. Prior to opening the lawn company, Charles earned $8,000 as a lifeguard at the neighborhood swimming pool. Assume the money he used to purchase the mowing equipment could otherwise have earned 1 percent per year in the bank and that the mowing equipment depreciates at 10 percent per year. Charles plans to mow 200 yards per year. What is Charles's implicit cost of production? Charles's implicit cost of production is $ per year. (Enter your response as an integer)
Charles has decided to open a lawn mowing company. To do so, he purchases mowing equipment for $4,000, buys gasoline ($1.50 in gas is required to mow each yard), and pays a helper $15.00 per yard. Prior to opening the lawn company, Charles earned $8,000 as a lifeguard at the neighborhood swimming pool. Assume the money he used to purchase the mowing equipment could otherwise have earned 1 percent per year in the bank and that the mowing equipment depreciates at 10 percent per year. Charles plans to mow 200 yards per year. What is Charles's implicit cost of production? Charles's implicit cost of production is $ per year. (Enter your response as an integer)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Charles has decided to open a lawn mowing company. To do so, he purchases mowing equipment for $4,000, buys gasoline ($1.50 in gas is required to mow each yard), and pays a helper $15.00 per yard. Prior to opening the lawn company, Charles earned $8,000 as a lifeguard at the neighborhood swimming pool. Assume the money he used to purchase the mowing equipment could otherwise have earned 1 percent per year in the bank and that the mowing equipment depreciates at 10 percent per year. Charles plans to mow 200 yards per year.
What is Charles's implicit cost of production?
Charles's implicit cost of production is $ per year. (Enter your response as an integer)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
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.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education