Use the following information to answer the next question. Harvey quit his job at State University where he earned $45,000 a year. He figures his entrepreneurial talent or forgone entrepreneurial income to be $5,000 a year. To start the business, he cashed in $100,000 in bonds that earned 10% interest annually to buy a software company, Extreme Gaming. In the first year, the firm sold 11,000 units of software at $75 each. Of the $75, $55 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. The implicit costs of Harvey's firm in the first year were
A. $150,000.
B. $100,000.
C. $50,000.
D. $60,000.
Answer: D
Economics
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The difference between iron ore deposits and the steel produced from these deposits that is later used to make factory equipment illustrates the difference between:
A) labor and a natural resource. B) labor and capital. C) a natural resource and capital. D) a natural resource and entrepreneurship.
Economics
In the short run, a price searcher wishing to maximize profits or minimize losses should produce the output that
a. equates marginal cost with marginal revenue. b. equates marginal cost with price. c. corresponds to the lowest point on the average variable cost curve. d. corresponds to the lowest point on the average total cost curve.
Economics