Last year Christine worked as a consultant. She hired an administrative assistant for $15,000 per year and rented office space (utilities included)for $3,000 per month. Her total revenue for the year was $100,000. If Christine hadn't worked as a consultant, she would have worked at a real estate firm earning $40,000 a year. Last year, Christine's explicit costs were ________, and her implicit costs were ________.
A)$15,000; $43,000
B)$18,000; $40,000
C)$36,000; $140,000
D)$51,000; $40,000

Question

Quizplus · Accepted Answer

Christine's explicit costs are 12 months of rent and the administrative assistant's salary: $36,000 + $15,000. Her implicit costs are her foregone salary of $40,000.

Last Year Christine Worked as a Consultant