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xenn [34]
3 years ago
7

Jamar used to work as an office manager, earning $40,000 per year. He gave up that job to start a life-coaching business. In cal

culating the economic profit of his life-coaching business, the $40,000 income that he gave up is counted as part of the life-coaching businesses.
Business
1 answer:
Eva8 [605]3 years ago
7 0

Answer:

B) opportunity costs.

Explanation:

The $40,000 salary that Jamar gave up are part of his opportunity costs.

Opportunity costs are the costs (or benefits lost) from choosing one activity or investment over another alternative.

When you calculate the economic profit of a new project you must include all the implicit or opportunity costs that you incur or lose due to the new project:

economic profit = accounting profit - implicit costs

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A business produces 10 units of output. Its average variable cost (AVC) = $25, average fixed cost (AFC) = $5, and marginal cost
kramer

Answer: $30

Explanation:

Given that,

Average variable cost (AVC) = $25

Average fixed cost (AFC) = $5

Marginal cost (MC) = $30

Average total cost (ATC) = Average fixed cost (AFC) + Average variable cost (AVC)

                                          = $5 + $25

                                          = $30

Therefore, average total cost is the sum of average fixed cost and average variable cost. Alternatively, average total cost is calculated by dividing total cost to units of output produced.

6 0
2 years ago
Sort the examples below into the appropriate bin. Think about which factors could lead to more toxic substances being released i
Zielflug [23.3K]

Answer:

1. Causes: commercial production of many chemicals massive use of chemicals in food, agriculture, medicine, and industry

2. Consequences: increase in reproductive disorders contamination of soil, air, and water bioaccumulation and biomagnification of toxins in the food chain.

3. Solutions: consumer choice of low-toxicity products stricter regulations requiring that consumer products be thoroughly tested before being released to market.

Explanation:

This factors could lead to more toxic substances being released into the environment (causes), the consequences that result from toxic substances in the environment, and possible solutions to save environmental degradation.

8 0
3 years ago
Economic models often: vary greatly in assumptions and simplifications. are correct. provide similar answers. fail to explain an
polet [3.4K]

Answer:

Economic models often vary greatly in assumptions and simplifications.

Explanation:

Most models in Classical Economics are based on a lot of generalizations and simplifications, that intend to model the behavior of the situations of the real world but often fail to encompass all the intricacies and complications that even most straightforward situations present. These simplifications help the Economists figure out the mathematical laws that are governing the real world economic systems. Therefore making the economic modeling a simpler process.

Classic economics implies three basic assumptions:

1- People behave rationally in any situation.

2- Firms and individual want to maximize profit and utility

3- People act independently based on available information.

7 0
3 years ago
A firm is considering two projects. Project Peso requires an initial investment of $100,000. The Internal Rate of Return for Pro
Fofino [41]

Answer:

to accept both the projects i.e. Project Peso and Project Quasi

Explanation:

As we can see in the given case, that the weighted average cost of capital on the projects is 9% while on the other hand, Perso and Quasi both have the internal rate of return 10.6% and 12.6% i.e. above 9% so based on this, the decision that should firm make is to accept both the projects i.e. Project Peso and Project Quasi

The same would be relevant

6 0
3 years ago
Lee Airlines plans to issue 12-year bonds with a par value of $1,000 that will pay $70 every six months. The bonds have a market
Zielflug [23.3K]

Answer:

After tax cost of debt = 10.43%

Explanation:

Market price = 960

Flotation cost = 0.07

Market price after Flotation cost = 960*(1-0.07) = 960*0.93 = 892.8

Face value = 1,000

Interest payment (PMT) = 1000*0.07 = 70

Term of payment = 12*2 = 24

Cost of debt before tax = Rate(24, 70, -892.8, 1000, 0)*2

Cost of debt before tax = 0.080198497*2

Cost of debt before tax = 0.160396994

Cost of debt before tax = 16.04%

Tax rate = 35%

After tax cost of debt = 16.04% * (1-35%)

After tax cost of debt = 0.1604*0.65

After tax cost of debt = 0.10426

After tax cost of debt = 10.43%

6 0
3 years ago
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