In an industry of 7 companies, if each makes $4,000 in revenue: a) Calculate the industry's four-firm concentration ratio [2] b) How would you calculate this industry and why? [2] 1. If Wolf Toys has an increase in total revenue from $5,000 to $8,000 when its output increases from 400 to 550 thys, then what is the marginal revenue of each of these last 150 Toys? [2 Points] 3. Sophia operates a variety store with an annual revenue of $500,000. Each year she pays $40,000 in rent for the store, $20,000 in business taxes, and $330,000 on products to sell. She estimates that she could put the $100,000 she has invested in the store into a friends fitness business instead and earn an annual 15% on her investment. She also estimates that she and her family could earn at total wage of $80,000 per year if they worked someone other than the store. [6 Points] a. Calculate the total Explicit costs and total implicit costs of running the variety store? Explicit:\$ Implicit: \$ b. What is the accounting profit AND economic profit of the store? Accounting: \$ Economic: \$ c. Should Sophia consider closing down her business? Why or Why not? [2] 4. Identify if each of the following short run costs are fixed or variable [2 Points] a. Employee Pension contributions b. Business Insurance c. Legal \& Advertising fees d. Salary for workers e. Wages for union workers f. Sugar \& flour for a bakery