Shelby is an entrepreneur who has decided to open a small advertising firm. She rents office space at a cost of $25,000 per year
, she has employed an assistant at a salary of $30,000 per year, and she incurs annual utility and office supply expenses of $20,000. Her best alternative is to work elsewhere and to earn a salary of $50,000 per year. How much annual revenue must her firm receive so that Shelby earns zero economic profit?
In order to cover for all of her expenses and the salaries of her employees, in this case she only has 1 that is costing her $30,000, she has the cost of the rent for $25,000 a year, and the annual utility and office expenses of $20,000, if she desires to earn at least the same $50,000 that the other place is offering her she needs to earn a total of $125,000 in order to be able to pay for the rent of the office, cover the salaries of her and her assistant that add up to 80,000 a year and the office expenses of $25,000.
The best measure of center tendency for this set of data would be the median. It is the best measurement because the data set has an outlier. The outlier is the 30. So to find the median we first order the data set and then find out if the set is an even or odd set. This set is even so we just chose the middle number. If the set was even, we would add the two center number and divide them by 2.
