Golda Rush quit her job as a manager for Home Depot to start her own hair dressing salon, Goldilocks.
She gave up a salary of 40,000 per year, invested her savings of 30,000 (which was earning 5 percent interest) and borrowed 10,000 from a close friend, agreeing to pay 5 percent interest per year. In her first year, Golda spent 18,000 to rent a salon, hired a part-time assistant for 12,000 and incurred another 15,000 in expenses on equipment and hairdressing material. Based on this information, what is the amount of her explicit costs?
A) 45,000 B) 45,500 C) 47,000 D) 87,000
Question 2
Refer to Table 13-1. What portion of the marginal revenue of the 5th unit is due to the output effect and what portion is due to the price effect?
A) output effect = 1.50; price effect = 2.00 B) output effect = 5.50; price effect = -2.00
C) output effect = 3.00; price effect = 0.50 D) output effect = 4.00; price effect = -0.50
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