Ellie has been working for an engineering firm and earning an annual salary of $80,000 . She decides to open her own engineering business. Her annual expenses will include $15,000 for office rent, $3,000 for equipment rental, $1,000 for supplies, $1,200 for utilities, and a $35,000 salary for a secretary/bookkeeper. Ellie will cover her start-up expenses by cashing in a $20,000 certificate of
deposit on which she was earning annual interest of $500 . Ellie's annual implicit costs will equal
a. $55,200.
b. $75,200.
c. $80,500.
d. $165,700.
c
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Using the figure above, suppose with no trade Liz and Joe each produce at point A on their respective PPFs. Then, Liz suggests that they specialize and trade. She would produces only smoothies and Joe would produce only salads
Then she would sell 10 smoothies to Joe at a price of 2.5 salads per smoothie. In this scenario, A) Liz gains 10 smoothies and 5 salads, and Joe gains 5 smoothies. B) Liz gains 5 smoothies, and Joe gains 10 smoothies. C) Liz gains 10 smoothies, and Joe loses 5 smoothies. D) Liz gains 5 smoothies and 5 salads, and Joe loses 5 salads. E) Neither of the individuals gains from trade.
In which zone does the total physical product reach it maximum value?
A. Increasing marginal return B. Negative marginal return C. Diminishing marginal return D. Decreasing total physical product
If the quantity of money demanded exceeds the quantity of money supplied, then
A) the quantity of nonmonetary assets demanded exceeds the quantity supplied. B) the quantity of nonmonetary assets supplied exceeds the quantity demanded. C) the quantity of nonmonetary assets demanded will still equal the quantity supplied, all else being equal. D) you can make no conclusions about the relative supply and demand of nonmonetary assets.
Suppose that the central bank must follow a rule that requires it to increase the money supply when the price level falls and decrease the money supply when the price level rises. If the economy starts from long-run equilibrium and aggregate supply shifts left, the central bank must
a. decrease the money supply, which will move output back towards its long-run level. b. decrease the money supply, which will move output farther from its long-run level. c. increase the money supply, which will move output back towards its long-run level. d. increase the money supply, which will move output farther from its long-run level.