Asked by
Sydney Koolstra
on Dec 19, 2024
Verified
The following is cost information for the Creamy Crisp Donut Company.Entrepreneur's potential earnings as a salaried worker = $50,000Annual lease on building = $22,000Annual revenue from operations = $380,000Payments to workers = $120,000Utilities (electricity, water, disposal) costs = $8,000Value of entrepreneur's talent in the next best entrepreneurial activity = $80,000Entrepreneur's forgone interest on personal funds used to finance the business = $6,000Creamy Crisp's total revenues exceed its total costs, including a normal profit, by
A) $286,000.
B) $150,000.
C) $230,000.
D) $94,000.
Total Revenues
The total amount of money received by a company from its sales of goods or services, before any expenses are subtracted.
Entrepreneur's Talent
The unique set of skills, insights, and intuitions possessed by an entrepreneur that contributes to the successful establishment and growth of a business.
Implicit Costs
Indirect, non-monetary expenses involved in pursuing an activity or decision, often reflected as the opportunity cost of using resources.
- Acquire knowledge on the notion of economic profits and the process of determining them.
- Explore the ways in which businesses compute their complete costs and the ramifications of assorted expenses on company profitability.
Verified Answer
FU
Learning Objectives
- Acquire knowledge on the notion of economic profits and the process of determining them.
- Explore the ways in which businesses compute their complete costs and the ramifications of assorted expenses on company profitability.