Answer:
economic profit = $2000
Explanation:
given data
currently maximizes profit = 400 units
marginal cost = $25
average total cost = $20
to find out
earning economic profit
solution
first we get here Total revenues that is express as
Total revenues = currently maximizes profit × marginal cost
Total revenues = 400 × $25
Total revenues = $10000
and Total cost will be
Total cost = currently maximizes profit × average cost
Total cost = 400 × $20
Total cost = $8000
so economic profit will be
economic profit = Total revenues - Total cost
economic profit = $10,000 - $8,000
economic profit = $2000
Answer:
Anne should increase the order quantity to 162 units, that way the company will save $154 per year.
Explanation:
economic order quantity (EOQ) = √(2SD / H)
- order cost = $35
- holding cost per unit = $8
- annual demand = 3,000 units
EOQ = √[(2 x $35 x 3,000) / $8] = 162 units
total order cost per year = order costs x number of orders = $35 x (3,000 / 100) = $35 x 30 = 1,050
holding costs per year = average inventory x holding cost = 50 x $8 = $400
if EOQ is used:
order cost per year = (3,000 / 162) x $35 = $648
holding cost per year = 81 x $8 = $648
total savings = ($1,050 + $400) - ($648 + $648) = $154
Answer:
Explicit costs are the costs which requires the money to pay.
On the other hand, implicit costs refers to the benefit that is foregone by choosing some other work or doing some other activity.
Therefore,
Explicit costs are as follows:
1. Wages pays to his hired hand
2. Buys feed for his cows.
3. Gas expense that is used in truck
Implicit costs are as follows:
1. Foregone income of $27,000 from working at a dairy plant as a technician.
2. Time taken for extracting milk from all the cows.
Answer:
B. economic principles affecting entire countries.
Explanation:
Macroeconomics is the part of economic studies that studies the economy of a country as a whole. In this branch of economics, the aggregate income, growth, expenditure and inflation are considered. The performance of the entire economy is measured under macroeconomics. National income, Gross domestic product, inflation and unemployment fall under the macroeconomic studies.
