Microeconomics

1. Jane quit her job at Telus where she earned $36,000 a year. She cashed in $40,000 in corporate bonds that earned 10% interest annually to buy a mini-bus. Jane has decided to buy the mini-bus and set up a commuter service between Maple Ridge and Vancouver. There are 300 people who will pay $800 a year each for the commuter service; $650 from each person goes for gas, maintenance, insurance, depreciation, etc. (a) What are Jane's total revenues? (b) What are Jane's explicit costs? (c) What is Jane's accounting profit? (d) List two important implicit costs that Jane has not included. 2. Assume a firm has fixed costs of $80 and variable costs as indicated in the table below. Complete the cost table. Total product Total variable cost Total cost AFC AVC ATC MC SO $80 110 190 S $ 150 230 180 260 DJOUAWNKE 220 300 270 350 340 420 IIIII IIIII 440 520 580 660