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The Table Below Provides the Total Revenues and Costs for a Small

Question 73

Multiple Choice

The table below provides the total revenues and costs for a small landscaping company in a recent year.  Total Revenues ($) 250000 Total Costs ($)  wages and salaries 150000 risk-free return of 2% on owner’s capital of $20000400 - interest on bank loan 1500 - cost of supplies 27000 depreciation of capital equipment 8000 additional wages the owner could have earned in next 30000 best alternative  - risk premium of 4% on owner’s capital of $20000800\begin{array}{|l|l|}\hline \text { Total Revenues }(\$) & 250000 \\\hline & \\\hline \text { Total Costs }(\$) & \\\hline \text { wages and salaries } & 150000 \\\hline \text { risk-free return of } 2 \% \text { on owner's capital of } \$ 20000 & 400 \\\hline \text { - interest on bank loan } & 1500 \\\hline \text { - cost of supplies } & 27000 \\\hline \text { depreciation of capital equipment } & 8000 \\\hline \text { additional wages the owner could have earned in next } & 30000 \\\text { best alternative } & \\\hline \text { - risk premium of } 4 \% \text { on owner's capital of } \$ 20000 & 800 \\\hline\end{array} TABLE 7- 2
-Refer to Table 7- 2.The explicit costs for this firm are


A) $186 900.
B) $217 300.
C) $186 500.
D) $178 500.
E) $217 700.

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