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Alisiya [41]
3 years ago
9

Use the following information to answer the next question. Harvey quit his job at State University where he earned $45,000 a yea

r. He figures his entrepreneurial talent or foregone 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 economic profits of Harvey’s firm in the first year were:
a) $160,000.
b).$280,000.
c) $155,000.
d) $220,000.
Business
1 answer:
algol [13]3 years ago
7 0

Answer: Option(a) is correct.

Explanation:

Total Revenue = Units sold × price per unit sold

                        = 11,000 × $75

                        = $825,000

Explicit cost = Units sold × cost per unit

                    = 11,000 × $55

                    = $605,000

Implicit cost = Earning at state university + Entrepreneurial talent + cash bonds at 10% interest

                    = $45000 + $5,000 + ($100,000 × 10%)

                    = $60,000

Economic profits = Total Revenue - (Explicit cost + Implicit cost)

                            = $825,000 - ($605,000 + $60,000)

                            = $825,000 - $665,000

                            = $160,000

You might be interested in
The economy of Elmendyn contains 3,000 $1 bills.
Salsk061 [2.6K]

Answer:

The correct answer is:

$3,000; $3,000; $3,000; $15,000; $5,454.54

Explanation:

An economy contains 3,000 bills of $1.

If people hold all the money as currency,

the quantity of money in the economy

= 3,000 \times $1

= $3,000

If people hold all money as demand deposits and maintain 100% reserves

The quantity of money is

= 100% of $3,000

= $3,000

If people hold equal amounts of currency and demand deposits, and the banks maintain a reserve ratio of 100%

The quantity of money

= $1,500 + 100% of $1,500

= $3,000

If people hold all money as demand deposits and banks maintain a reserve ratio of 20 percent

The money multiplier

= \frac{1}{0.2}

= 5

The quantity of money

= 5 \times $3,000

= $15,000

If people hold equal amounts of currency and demand deposits and maintain a reserve ratio of 20%,

Currency = Demand deposits

10 \times ($3,000 - C) = D

$30,000 - 10C = D

We can also write this as,

$30,000 - 10D = D

$30,000 = 11D

D = 2,727.27

So the quantity of money will be

= $2,727.27 + $2,727.27

= $5,454.54

7 0
4 years ago
Before lean approaches could be implemented successfully, many North American companies needed to make which changes
qwelly [4]

Answer:

C. Cultural and organizational changes

Explanation:

The many northern american companies required to make the cultural and organization changes prior to the approaches i.e. lean that implemented successfully as if we bring the changes like cultural and organizational one so it would become very challenging task

Therefore as per the given situation the option c is correct

And, the rest of the options are wrong

7 0
3 years ago
The balance of the Estimated Warranty Liability account was $13,050 on January 1, 2013. and $18,300 on December 31. 2013. Based
Marrrta [24]

Answer:

$21,150

$15,900

Explanation:

The computation of the warranty expense is shown below:

= Sales × given percentage

= $1,410,000 × 1.5%

= $21,150

The computation of the actual costs of servicing products under warranty during the year is shown below:

= Opening balance of estimated  Liability account  + warranty expense - ending balance of estimated  Liability account

= $13,050 + $21,150 - $18,300

= $15,900

6 0
3 years ago
If+you+believe+you+have+a+60%+chance+of+doubling+your+money,+a+30%+chance+of+gaining+15%,+and+a+10%+chance+of+losing+your+entire
yawa3891 [41]

Answer:

t low

Explanation:

4 0
3 years ago
Please answer now!!
Naya [18.7K]

Answer:

Change in an organization leads to many positive aspects – that lead to retaining a competitive edge and also remaining relevant in your business area. Change encourages innovation, develops skills, develops staff and leads to better business opportunities and improves staff morale

hope this helped you

please mark as the brainliest (ㆁωㆁ)

7 0
3 years ago
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