Renee runs an accounting firm that does tax returns, which she operates out of a building that she owns downtown.She hires all of the accountants and buys the equipment and supplies for the business.The costs used to calculate the total cost curve include
A)the salaries of the accountants, the equipment and supply costs, and the opportunity cost of the building that houses the firm.
B)only the salaries of the accountants and the equipment and supply costs, since she owns the building.
C)just the costs of the accountant's salaries.
D)the costs of the accountant's salaries plus the opportunity costs of the building.

Question

Quizplus · Accepted Answer

The total cost curve includes all costs associated with running the business, which encompasses the salaries of the accountants, the equipment and supply costs, and the opportunity cost of the building, even if Renee owns it. The opportunity cost represents the income she foregoes by using the building for her firm instead of renting it out or selling it.

Renee Runs an Accounting Firm That Does Tax Returns, Which