# ECON 1B - John was a cook making the average cook salary

Question # 00709826 Posted By: dr.tony Updated on: 08/07/2018 12:43 PM Due on: 08/07/2018
Subject Economics Topic Microeconomics Tutorials:
Question

John was a cook making the average cook salary of \$60,000 per year. He also had an extra room in his house that he rented out for \$10,000 per year. But John got "fed up" with his job and decided to quit and pursue his dream ... making toilets. He pays a worker \$40,000 per year and spends \$150,000 annually on material inputs. He also kicks the tenant out of his extra room and uses it to make toilets. Every year he sells 100 toilets at \$2,500 each.

a. What are John's accounting profits as a toilet producer? (Show work)

b. What are John's economic profits as a toilet producer? (Show work)

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1. ## Solution: ECON 1B - John was a cook making the average cook salary

Tutorial # 00709702 Posted By: dr.tony Posted on: 08/07/2018 12:43 PM
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The solution of ECON 1B - John was a cook making the average cook salary...
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2. ## Solution: Accounting profit is the difference between revenue (sale proceeds) and explicit cost incurred to generate revenue.

Tutorial # 00712023 Posted By: Jitender Posted on: 09/22/2018 08:32 PM
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costs)As a cook, John was earning a salary of \$50,000 ...
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