mark Merchant owns and manages a café at food court. His monthly figures are: Revenue: $5,000 Expenses: Labour: $2,000 Food & Drink: $500 Electricity & Water: $100 Vehicle Lease: $150 Rent: $500 Monthly rental for Equipment: $1,000 a) Calculate mark's monthly accounting profit. b) mark could earn $1,000 per month as a recycler of cans. But he prefers to run the café. In fact, he would be willing to pay up to $275 a month to run the café rather than recycle cans, In this case, is the café making an economic profit? Should mark stay in business of running the café?
mark Merchant owns and manages a café at food court. His monthly figures are: Revenue: $5,000 Expenses: Labour: $2,000 Food & Drink: $500 Electricity & Water: $100 Vehicle Lease: $150 Rent: $500 Monthly rental for Equipment: $1,000 a) Calculate mark's monthly accounting profit. b) mark could earn $1,000 per month as a recycler of cans. But he prefers to run the café. In fact, he would be willing to pay up to $275 a month to run the café rather than recycle cans, In this case, is the café making an economic profit? Should mark stay in business of running the café?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
mark Merchant owns and manages a café at food court. His monthly figures are:
Revenue: $5,000
Expenses:
Labour: $2,000
Food & Drink: $500
Electricity & Water: $100
Vehicle Lease: $150
Rent: $500
Monthly rental for Equipment: $1,000
a) Calculate mark's monthly accounting profit.
b) mark could earn $1,000 per month as a recycler of cans. But he prefers to run the café. In fact, he would be willing to pay up to $275 a month to run the café rather than recycle cans,
In this case, is the café making an economic profit? Should mark stay in business of running the café?
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