Answer: Jessica's implicit costs are $46,000.
Implicit costs are the benefits that an individual gives up when they take a decision. Implicit costs are also known as opportunity costs.
In this case, Jessica will lose her salary of $40,000 each year. She will also lose the rent of $6000 a year from the building if she opens her fast food joint. So, total implicit costs are:
Answer:
The false statement is letter "A": We say a portfolio is long those stocks that have negative portfolio weights.
Explanation:
The portfolio weight is the portion that a particular asset represents of the overall portfolio. There are many methods helpful to calculate the portfolio weight usually by dividing the dollar value of an asset by the total dollar value of the portfolio. Short positions are taken as negative values inside the portfolio that hold negative weights.
Well you should definitely do some appetizers. Try jalapeno poppers or mozzarella sticks.
You can't go wrong with cheese <span />
Answer:
If the company makes the units, it will save $7,000 per period.
Explanation:
Giving the following information:
Make in-house:
Number of units= 16,000
Variable cost per unit= $22
<u>Avoidable fixed cost per unit= $3</u>
Buy:
Number of units= 16,000
Buying price= $27
Rent= $25,000
<u>First, we will determine the total cost of each option:</u>
Make:
Total cost= 16,000*(22 + 3)= $400,000
Buy:
Total cost= 16,000*27 - 25,000= $407,000
If the company makes the units, it will save $7,000 per period.
