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Gennadij [26K]
3 years ago
7

Ben quit his job as an economics professor to become a golf professional. He gave up his $30,000 salary and invested his retirem

ent fund of $50,000 (which was earning 10 percent interest) in this venture. After all expenses, his net winnings were $35,000. Ben's economic profits were:________.
a. $35,000.
b. $5,000.
c. $2,000.
d. zero.
Business
1 answer:
Drupady [299]3 years ago
6 0

Answer:

The correct answer is B.

Explanation:

Giving the following information:

He gave up his $30,000 salary and invested his retirement fund of $50,000. After all expenses, his net winnings were $35,000.

The difference between economic profit and accounting profit is that the first one takes into account the opportunity cost. In this case, the cost of not perceiving the salary.

Economic profit= winnings - opportunity cost

Economico profit= 35,000 - 30,000= $5,000

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Paxton Company can produce a component of its product that incurs the following costs per unit: direct materials, $10.90; direct
siniylev [52]

Answer:

$ 8.9

Explanation:

Given:

Direct materials cost = $ 10.90

Direct labor = $ 14.90

Variable overhead cost = $ 3.90

Fixed overhead cost = $ 8.90

Selling price offered for the product = $ 38.60

Net incremental cost = Offered selling price - ( Direct materials cost + Direct labor + Variable overhead cost )

The fixed cost is not included because, it will be incurred whether the offer is accepted or not.

therefore,

Net incremental cost = $ 38.60 - ( $ 10.90 + $ 14.90 + $ 3.90 )

or

The net incremental cost = $ 8.9

7 0
3 years ago
Read 2 more answers
During the current year, Walter invests $35,000 in each of two separate corporations. Each investment gives him a 20% ownership
Bond [772]

Answer:

B) Only statement II is correct.

  • II. Has $20,000 of taxable income from Corporation Z.

Explanation:

One of the disadvantages of a C Corporation is that their owners (stockholders) are double taxed. That means that the corporation is taxed and then the stockholders are taxed depending on the dividends that they receive. In this case, Walter has $10,000 of taxable income from Corporation X (= $50,000 x 20%).

On the other hand, sole proprietorships, partnerships, limited liability companies and S Corporations are not taxed, they are pass through entities whose owners are taxed directly. In this case, Walter owns 20% of Corporation Z, therefore he must pay taxes on 20% of taxable income = $100,000 x 20% = $20,000.

8 0
3 years ago
________ enables production of more inexpensive and better fitting prosthetics than traditional manufacturing methods.
tia_tia [17]

"e-NABLE" is a grass-roots open source sharing community that uses 3D printers to create free printed prosthetic limbs.

8 0
3 years ago
Consider the following data, which shows the quantities and prices of two goods produced in the economy, to answer the following
maw [93]

Answer:

$250 million

Explanation:

Given that,

Cell phones:

Quantity produced = 5 million

Price per cell phone = $100

Pizza:

Quantity produced = 25 million

Price per pizza = $10

The market value of pizza is determined by the product of quantity produced and price of each pizza.

Market value of pizza:

= Quantity produced × Price per pizza

= 25 million × $10

= $250 million

8 0
3 years ago
Solve for the unknown number of years in each of the following (Enter rounded answers as directed, but do not use rounded number
marishachu [46]

Answer:

a)   7.627144987

b)   5.605222315

c)  20.04031392

d)  10.17644951

Explanation:

We need to solve for years starting from the future value of a lump sum formula:

PV(1+r)^n=FV\\

We use logarithmics properties and solve:

(1+r)^n=FV/PV\\\\log_{1+r}(FV/PV) = n\\\\n = \frac{log FV/PV}{log (1+r)}

a)

log(1655/800)/log1.1 = n

7.627144987

b)

log(4250/2491)/log1.08 = n

5.605222315

c)

log(392620/33905)/log1.13 = n

20.04031392

d)

log(214844/33600)/log1.20 = n

10.17644951

5 0
3 years ago
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