A local business is a busses that sells its products and services to consumers in its own city or town.
Answer: i believe this is true
Explanation:
Answer:
a. .938 If the exchange rate is less than this, it costs more dollars to buy a tall latte in the U.S. than in the Euro area.
Explanation:
We can see in the example that the Euro is cheaper than the dollar in purchasing-power parity. More specifically, the exchange rate is .938 euros per dollar.
This is why it is more expensive to buy a tall latte in the U.S. than in Europe. The Euro is cheaper.
Economic profits (or loss) is defined as the difference between revenues and the opportunity cost forgone. In the current case, the entrepreneur opted to start a business rather than being employed.
Therefore;
Economic profit = Revenues - Opportunity cost
In this problem;
Revenues = $300,000 - $150,000 - $25,000 - $25,000 = $100,000
Opportunity cost = $75,000
Therefore;
Economic profit = $100,000 - $75,000 = $25,000
