The following is cost information for the Creamy Crisp Donut Company: Entrepreneur's potential earnings as a salaried worker = $50,000 Annual lease on building = $22,000 Annual revenue from operations = $380,000 Payments to workers = $120,000
Utilities (electricity, water, disposal) costs = $8,000 Value of entrepreneur's talent in the next best entrepreneurial activity = $80,000 Entrepreneur's forgone interest on personal funds used to finance the business = $6,000 Refer to the data. Creamy Crisp's accounting profit is:
A. $150,000.
B. $380,000.
C. $230,000.
D. $294,000.
Answer: C
You might also like to view...
When the price of a good increases,
A) supply increases. B) quantity supplied increases. C) supply decreases. D) quantity supplied decreases.
Which of the following explains why the AD curve is downward sloping?
a. a lower price level forces the government to reduce taxes, shifting the IS curve to the right and increasing income. b. A lower price level forces the central bank to increase the money supply, shifting the LM curve to the right and increasing income. c. A lower price level increases real money balances, shifting the LM curve to the right and increasing income. d. none of the above are correct.
Which of the following provides an important source for data on colonial wealth?
a. census records b. newspapers c. records of charitable contributions d. probate records
If the prices of both goods increase by 10 percent, the budget line
a. shifts to the right in parallel fashion. b. shifts to the left in parallel fashion. c. is unaffected since only relative price changes matter. d. pivots on the axis of the more expensive good.