Sita is an auto mechanic and runs a smal repair shop. She Per year, pays a monthly rent of $5,000 towards the lease of the premises where her repair shop is located, and spends $20,000 per year on materials needed for repairing cars and trucks. She has invested $40,000 of her own savings in heavy equipment (air and strut compressors, brake lathes, heavy-duty lifts etc.) that could earn her $4,000 per year if invested elsewhere. She has been offered $40,000 per year by a competitor to work as a mechanic for them and she estimates the value of income she could earn in her spare time to be $5,000. The repair shop's total annual revenue is $250,000. What is Gita's yearly fixed cost in dollars? what is Gita's yearly variable cost in dollars? what is Gita's yearly explicit cost? what is Gita's yearly implicit cost? what is Gita's accounting profit? and what is Gita's yearly economic profit? and finally is Gita making the best use of her resources

Sita is an auto mechanic and runs a smal repair shop. She Per year, pays a monthly rent of $5,000 towards the lease of the premises where her repair shop is located, and spends $20,000 per year on materials needed for repairing cars and trucks. She has invested $40,000 of her own savings in heavy equipment (air and strut compressors, brake lathes, heavy-duty lifts etc.) that could earn her $4,000 per year if invested elsewhere. She has been offered $40,000 per year by a competitor to work as a mechanic for them and she estimates the value of income she could earn in her spare time to be $5,000. The repair shop's total annual revenue is $250,000. What is Gita's yearly fixed cost in dollars? what is Gita's yearly variable cost in dollars? what is Gita's yearly explicit cost? what is Gita's yearly implicit cost? what is Gita's accounting profit? and what is Gita's yearly economic profit? and finally is Gita making the best use of her resources

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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