The neighborhood ice cream shop finds that when it charges $3 per ice cream cone, its total revenues are $90,000. It has total variable costs of $30,000 and total fixed costs of $40,000. From this we can infer the:

Question

Quizplus · Accepted Answer

Economic profits are equal to total revenues minus total costs. In this case, total revenues are $90,000, total variable costs are $30,000, and total fixed costs are $40,000. So, total costs are $70,000. Therefore, economic profits are $90,000 - $70,000 = $20,000.

The Neighborhood Ice Cream Shop Finds That When It Charges