A young chef is considering opening his own sushi bar. To do so, he would have to quit his current job, which pays $20,000 a year, and take over a building that he owns and currently rents to his brother for $6,000 a year. His expenses at the sushi bar would be $50,000 for food and $2,000 for gas and electricity. The chef's explicit costs are equal to_____.
A)$26,000
B)$66,000
C)$78,000
D)$52,000
E)$72,000

Question

A young chef is considering opening his own sushi bar. To do so, he would have to quit his current job, which pays $20,000 a year, and take over a building that he owns and currently rents to his brother for $6,000 a year. His expenses at the sushi bar would be $50,000 for food and $2,000 for gas and electricity. The chef's explicit costs are equal to_____.​
A)$26,000
B)$66,000
C)$78,000
D)$52,000
E)$72,000

Quizplus · Accepted Answer

Explicit costs are the direct, out-of-pocket expenses, which in this case are $50,000 for food and $2,000 for gas and electricity, totaling $52,000.

A Young Chef Is Considering Opening His Own Sushi Bar