Scenario 13-4
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 13-4.What are Wanda's total economic profits?

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, which is $150 - $54 = $96.

Scenario 13-4 Wanda Owns a Lemonade Stand.She Produces Lemonade Using Five Inputs