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
<span>187.5.......................................</span>
Answer:
Explanation:
the present value of the future cash flows is the the value of the bond we calculate the present value as follows
Cash flow 4% = 40000 per year for 4 year p.v using annuity
Cash flow = 1000000 at year four present value using compound formula
Present value at yield rate 7.7%
Cash flow Discount Factor Present Value
1000000 0.743253883 743253.8831
40000 3.334365155 133374.6062
876628.4893
Compound = 1000000/(1+7.7%)^4
Annuity = 40000* (1-(1+7.7%)^-4) / 7.7%
