Foundations of Economics, 8th Edition

Chapter Checkpoint

Click here to open your MyEconLab Study Plan and work these interactive problems online.

Study Plan Problems and Applications

1. Joe runs a shoe shine stand at the airport. Joe has no skills, no job experience, and no alternative job. Entrepreneurs in the shoe shine business earn $10,000 a year. Joe pays the rent of $2,000 a year, and his total revenue is $15,000 a year. He borrowed $1,000 at 20 percent a year to buy equipment. At the end of one year, Joe was offered $500 for his business and all its equipment. Calculate Joe’s annual explicit costs, implicit costs, and economic profit.

2. Len’s body board factory rents equipment ...