A few years ago, a construction manager earning

Assignment Help Business Economics

Reference no: EM1317874

Q. A few years ago, a construction manager earning $70,000/ year working for a regional home builder decided to open his own home building company. He took $100,000 out of one of his investment accounts that had been earning around 6% a year and used that money to start up the business. He worked hard for the first year, hiring one employee (his only salary cost for the business was $40,000 paid to his employee) and generated total sales of $1,000,000. Total material and subcontracted labor costs for the year were $900,000. Estimate accounting profit. Illustrate what are the opportunity costs for the manager of being in this business relative to returning to his old job? Illustrate what is the economic profit of the business?

Reference no: EM1317874

Questions Cloud

Marketplace is highly competitive with box currently selling : The marketplace is highly competitive, with boxes currently selling for $100 every thousand. Conigan's total and marginal cost curves.

Evaluate the dominant behavior : Taylor expansion to find the dominant behavior of velocity - evaluate the dominant behavior of v(t), and also the first correlation to that dominant behavior.

Estimating the value of a function : Estimating the value of a function using 3rd Taylor polynomial and use our error guarantee to give a Plus- or-minus error to your estimate

Mud turtles observation by a biologist : A biologist has found the average weight of 12 randomly selected mud turtles to be 8.7 lb with standard deviation 3.6 lb. find a 90% confidence interval for the population mean weight of all such turtles.

A few years ago, a construction manager earning : A few years ago, a construction manager earning $70,000/ year working for a regional home builder decided to open his own home building company.

Evaluate the value of x for which the power series converges : Evaluate the value of x for which the power series converges - determine whether or not it converges at the endpoints of that interval.

Effective probability for drug : What is the probability that the drug will be effective for 3 hours or more?

Cause a shift of the aggregate demand curve : Determine whether each of the following would cause a shift of the aggregate demand curve, a shift of the aggregate supply curve.

Position the null and the alternate hypothesis : Based on the answers to a through d, decide whether or not to reject the null hypothesis at the given significance level. Explain your conclusion in the context of the problem.

User Account

All Pages