Economics

Question 1 (Lecture 7a) The table below provides the total revenues and cost information for a small landscaping company in recent year. (Show work) Calculate the implicit costs for this firm. Total Revenues ($) 250,000 Total Costs ($) wages and salaries 115,000 - risk-free return of 1% on owner's capital of $20,000 200 interest on bank loan 1,500 - cost of supplies 27,000 - depreciation of capital equipment 7,000 - additional wages the owner could have earned in next best alternative 33,000 risk premium of 3% on owner's capital of $20,000 600