Scenario 13-13
Christine is an artist who creates custom cookie jars. Her annual revenue from selling the cookie jars is $90,000. The annual explicit costs of the materials used to make the cookie jars are $54,000.
-Refer to Scenario 13-13. Christine could earn $6,000 per year preparing taxes. In calculating the economic profit of her cookie jar business, the $6,000 that Christine gives up is counted as part of her business's
A)total revenue.
B)explicit costs.
C)implicit costs.
D)marginal costs.

Question

Quizplus · Accepted Answer

The $6,000 that Christine could earn by preparing taxes is her opportunity cost, which is an implicit cost and should be included in the calculation of economic profit.

Scenario 13-13 Christine Is an Artist Who Creates Custom Cookie Jars. Her