Scenario 13-7
Wanda owns a lemonade stand. She produces lemonade using five inputs: water, sugar, lemons, paper cups, and labor. Her costs per glass are as follows: $0.01 for water, $0.02 for sugar, $0.03 for lemons, $0.02 for cups, and $0.10 for the opportunity cost of her labor. She can sell 300 glasses for $0.50 each.
-Refer to Scenario 13-7.What are Wanda's total economic profits?
A) $150
B) $126
C) $96
D) $54

Question

Quizplus · Accepted Answer

Wanda's total revenue is 300 glasses * $0.50 = $150. Her total cost per glass is $0.01 + $0.02 + $0.03 + $0.02 + $0.10 = $0.18. Total cost for 300 glasses is 300 * $0.18 = $54. Economic profit is total revenue - total cost = $150 - $54 = $96.

Scenario 13-7 Wanda Owns a Lemonade Stand. She Produces Lemonade Using Five