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tionna98 tionna98
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Posts: 341
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6 years ago
Economic profit is defined as total revenue
 a. plus total costs
  b. minus marginal costs
  c. minus variable costs
  d. minus total costs
  e. minus fixed costs

QUESTION 2

Accounting profit equals
 a. explicit costs minus implicit costs
  b. economic profit minus implicit costs
  c. economic profit minus explicit costs
  d. economic profit minus explicit costs and implicit costs
  e. economic profit plus implicit costs

QUESTION 3

Which of the following would not appear on a firm's accounting statement?
 a. sunk costs
  b. fixed costs
  c. explicit costs
  d. implicit costs
  e. insurance costs

QUESTION 4

Amanda, age 6, opens a lemonade stand. She makes all the lemonade from a mix she found in her parents' pantry. Her stand is an old box she found in the garage. The pitcher and paper cups were taken from the kitchen. Which of the following is true?
 a. The opportunity cost of the lemonade is zero.
  b. The only opportunity cost of the lemonade is Amanda's time.
  c. Amanda's explicit costs are zero.
  d. The implicit costs of Amanda's lemonade are zero.
  e. Whatever revenue Amanda gets will be pure economic profit.

QUESTION 5

Maryann and Don want to open their own deli. To do so, Maryann must give up her job, at which she earns 20,000 per year, and Don must give up his part-time job, at which he earns 10,000 per year. They must liquidate their money market fund, which earns 1,000 interest annually. The rent on the building is 10,000 per year, and expenses for such necessities as utilities, corned beef, and pickles are 35,000 annually. What is the explicit cost per year of operating the deli?
 a. 10,000
  b. 35,000
  c. 45,000
  d. 31,000
  e. 76,000

QUESTION 6

Two friends, Diane and Sam, own and run a bar. Diane tends bar on Monday, Wednesday, and Friday and receives a wage in addition to tips. Sam tends bar on Tuesday, Thursday, and Saturday and receives only tips. Which of the following represents an implicit cost of operating the bar?
 a. Diane's wage
  b. Sam's time
  c. Diane's tips
  d. Sam's tips
  e. both Diane's and Sam's tips

QUESTION 7

A young chef is considering opening his own sushi bar. To do so, he would have to quit his current job, which pays 20,000 a year, and take over a store building that he owns and currently rents to his brother for 6,000 a year. His expenses at the sushi bar would be 50,000 for food and 2,000 for gas and electricity. What are his implicit costs?
 a. 26,000
  b. 66,000
  c. 78,000
  d. 52,000
  e. 72,000
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mcgee2mcgee2
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Posts: 344
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6 years ago
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tionna98 Author
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6 years ago
This helped my grade so much Perfect
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Smart ... Thanks!
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