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Elden [556K]
2 years ago
7

Diana is a personal trainer whose client Charles pays $80 per hour-long session. Charles values this service at $100 per hour, w

hile the opportunity cost of Diana's time is $75 per hour. The government places a tax of $10 per hour on personal trainers. Before the tax, what is the total surplus?
a. $25
b. $20
c. $5
d. $0
Business
1 answer:
Verdich [7]2 years ago
4 0

Answer:

Option (a) $25

Explanation:

Data provided in the question:

Amount paid by the client by Charles = $80 per hour

Value put for the service by Charles = $100 per hour

Opportunity cost of Diana's time = $75 per hour

Tax = $10 per hour

Now,

Consumer Surplus

= Value put up by buyer for service - Amount actually paid for service

= $100 - $80

= $20

Producer Surplus

= Amount actually paid for session - Opportunity cost of seller

= $80 - $75

= $5

Therefore,

The Total surplus = Consumer Surplus  + Producer Surplus

= $20 + $5

= $25

Hence,

Option (a) $25

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Answer:

(A) $731,250

Explanation:

The formula to compute the break-even point in sales dollars is shown below:

= (Fixed expenses or Fixed cost) ÷ (Contribution ratio)

where,

Contribution ratio = Contribution margin ÷ sales

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                             = 0.32 or 32%

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Now put the values to the above formula

So, the value would equal to

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2 years ago
A rectangular field with one side along a river is to be fenced. Suppose that no fence is needed along the river, the fence on t
Klio2033 [76]

Answer:

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Explanation:

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The cost as a function of R is:

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The value of R for which the derivate of the cost function is zero is the length that minimizes cost:

C'(R) =0= 40 -576,000R^{-2}\\R=\sqrt{\frac{576,000}{40}}\\R=120\ ft\\

If R is 120 ft, then the value of L is:

L = \frac{28,800}{120}\\L=240\ ft

The dimensions that will minimize costs are:

Side opposite the river = 120 ft

Other sides = 240 ft

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2 years ago
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If you put $700 in a savings account with a 10% nominal rate of interest compounded monthly, what will the investment be worth i
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8 0
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