Complete the following table by determining Raphael's accounting and economic profit of his piano business. Profit (Dollars) Accounting Profit Economic Profit
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- Rodriguez operates a variety store that provides an annual revenue of $550,000. Each year, he pays $25,000 in rent for the store, $20,000 in business taxes, and $400,000 on products to sell. He estimates he could put the $100,000 he has invested in the store into his friend's restaurant business instead and earn an annual 20% profit on his funds. He also estimates that he and his family could earn a total annual wage of $90,000 if they worked somewhere other than the store. Include a minus sign (-) in front of any negative values entered as a solution below. a. The total explicit costs of running the store are $ The total implicit costs of running the store are $ b. The accounting profit of the kariety store is $ The economic profit of the variety store is $Rodriguez operates a variety store that provides an annual revenue of $500,000. Each year, he pays $30,000 in rent for the store, $20,000 in business taxes, and $350,000 on products to sell. He estimates he could put the $80,000 he has invested in the store into his friend's restaurant business instead and earn an annual 20% profit on his funds. He also estimates that he and his family could earn a total annual wage of $90,000 if they worked somewhere other than the store. Include a minus sign (-) in front of any negative values entered as a solution below. a. The total explicit costs of running the store are $ The total implicit costs of running the store are $ b. The accounting profit of the variety store is $ ces The economic profit of the variety store is $ c. Rodriguez (Click to select) v consider closing down this business because he is making a (Click to select)Kenji lives in Mississauga and runs a business that sells pianos. In an average year, he receives $723,000 from selling pianos. Of this sales revenue, he must pay the manufacturer a wholesale cost of $423,000; he also pays wages and utility bills totalling $267,000. He owns his show room; if he chooses to rent it out, he will receive $2,000 in rent per year. Assume that the value of this show room does not depreciate over the year. Also, if Kenji does not operate this piano business, he can work as a financial advisor, receive an annual salary of $20,000 with no additional monetary costs, and rent out his show room at the $2,000 per year rate. No other costs are incurred in running this piano business. Identify each of Kenji's costs in the following table as either an implicit cost or an explicit cost of selling pianos. Implicit Cost The wages and utility bills that Kenji pays The salary Kenji could earn if he worked as a financial advisor The rental income Kenji could receive if he…
- Joseph migrated to Canada from Ghana 5 years ago. He currentlyworks in sales but is considering quitting work for two years to earn an MBA degree. His current job pays $40,000 per year (after taxes), but he could earn $55,000 per year (after taxes) if he had an MBA. Tuition is $10,000 per year, and the cost of an apartment near campus is equal to the $10,000 he is currently paying. His discount rate is 6 percent per year. He just turned 48 and plans to retire when he turns 60, whether or not he earns his MBA degree. Based on this information, should he go for an MBA degree? Explain carefully with appropriate calculations. Using time value of money to solve.Yakov lives in Montreal and runs a business that sells boats. In an average year, he receives $793,000 from selling boats. Of this sales revenue, he must pay the manufacturer a wholesale cost of $430,000; he also pays wages and utility bills totalling $301,000. He owns his showroom; if he chooses to rent it out, he will receive $15,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Yakov does not operate this boat business, he can work as a financial advisor and receive an annual salary of $50,000 with no additional monetary costs. No other costs are incurred in running this boat business. Identify each of Yakov's costs in the following table as either an implicit cost or an explicit cost of selling boats. Implicit Cost Explicit Cost The rental income Yakov could receive if he chose to rent out his showroom The wholesale cost for the boats that Yakov pays the manufacturer The salary Yakov could earn if he worked as a financial…Sam lives in San Diego and operates a small company selling bikes. On average, he receives $694,000 per year from selling bikes. Out of this revenue from sales, he must pay the manufacturer a wholesale cost of $392,000. He also pays several utility companies, as well as his employees wages totaling $289,000. He owns the building that houses his storefront; if he choose to rent it out, he would receive a yearly amount of $2,000 in rent. Assume there is no depreciation in the value of his property over the year. Further, if Sam does not operate the bike business, he can work as a programmer and earn a yearly salary of $20,000 with no additional monetary costs, and rent out his storefront at the $2,000 per year rate. There are no other costs faced by Sam in running this bike company. Identify each of Sam’s costs in the following table as either an implicit cost or an explicit cost of selling bikes. Implicit Cost Explicit Cost The wages that Sam pays The…
- Eric lives in Denver and operates a small-company selling bikes. On average, he receives $773,000 per year from selling bikes. Out of this revenue from sales, he must pay the manufacturer a wholesale cost of $452,000. He also pays several utility companies, as well as his employees wages totaling $277,000. He owns the building that houses his storefront; if he choose to rent it out, he would receive a yearly amount of $3,000 in rent. Assume there is no depreciation in the value of his property over the year. Further, if Eric does not operate the bike business, he can work as a nurse and earn a yearly salary of $32,000 with no additional monetary costs, and rent out his storefront at the $3,000 per year rate. There are no other costs faced by Eric in running this bike company. Identify each of Eric's costs in the following table as either an implicit cost or an explicit cost of selling bikes. Implicit Cost Explicit Cost The rental income Eric could receive if he chose to rent out his…Manuel lives in Dallas and operates a small company selling drones. On average, he receives $778,000 per year from selling drones. Out of this revenue from sales, he must pay the manufacturer a wholesale cost of $462,000. He also pays several utility companies, as well as his employees wages totaling $257,000. He owns the building that houses his storefront; if he choose to rent it out, he would receive a yearly amount of $12,000 in rent. Assume there is no depreciation in the value of his property over the year. Further, if Manuel does not operate the drone business, he can work as a blogger and earn a yearly salary of $50,000 with no additional monetary costs, and rent out his storefront at the $12,000 per year rate. There are no other costs faced by Manuel in running this drone company. Identify each of Manuel’s costs in the following table as either an implicit cost or an explicit cost of selling drones. Implicit Cost Explicit Cost The wholesale cost for the…Dexter set up a computer repair business out of his home office. Based on the square footage of his office, he allocates a fixed cost of $400 per month in mortgage expenses. He also has a monthly internet bill of $45 and a monthly phone bill of $35. While repairs vary greatly, Dexter estimates an average of $19 in expenses per repair and charges a flat $49 fee per repair for his labor. 3a. How many computers does Dexter need to repair each month to break even?__________3b. What is Dexter’s profit / loss if he only repairs 8 computers in a month?__________3c. What fee would Dexter need to charge to break even at 8 repairs?
- Sara has decided to quit her corporate job and live her dream by opening up her own food truck selling her "famous" tacos. She expects to earn $90,000 per year once she gets a loyal following. To run her business, she will need to get a food truck, equipment, and a license. The food truck will cost her $800 per month to lease, equipment rentals are $150 per month and an annual license is $300. Sara will also be taking a large pay cut to follow her dream. Her corporate job's annual salary is $100,000 annually. What is Sara's economic profit?Nick is considering quitting his current job as an electrician and following his lifelong dream of opening a restaurant. This decision requires careful analysis and evaluation. If he chooses to do this, he would have to quit his current job, which pays $70,000 a year, and take over a building that he owns and currently rents out for $12,000 a year. His expenses at the restaurant would be $100,000 for food and $8,000 for gas and electricity. Nick should go ahead and quit current job and implement his plans only if the projected revenue is equal or greater than a $12,000 b $82,000 c $108,000 d $190,000 e $70,000Jacques lives in Detroit and operates a small company selling bikes. On average, he receives $773,000 per year from selling bikes. Out of this revenue from sales, he must pay the manufacturer a wholesale cost of $452,000. He also pays several utility companies, as well as his employees wages totaling $277,000. He owns the building that houses his storefront; if he choose to rent it out, he would receive a yearly amount of $3,000 in rent. Assume there is no depreciation in the value of his property over the year. Further, if Jacques does not operate the bike business, he can work as a nurse and earn a yearly salary of $32,000 with no additional monetary costs, and rent out his storefront at the $3,000 per year rate. There are no other costs faced by Jacques in running this bike company. Identify each of Jacques's costs in the following table as either an implicit cost or an explicit cost of selling bikes. Implicit Cost Explicit Cost The wages that Jacques pays The wholesale cost for the…