QUESTION 3

1. The short run is defined as:
2. one year or less.
3. a period in which all factors of production are variable.
4. three years or less.
5. a period in which at least one factor of production is fixed.

A person starts his own business. He quits his $75,000 a year job. Expenses include wages and salaries of $100,000 a year, utilities of $5,000 a year, and materials of $40,000 and equipment of $50,000. If revenues are $200,000, his accounting profit is ____ and his economic profit is ______

$80,000; $5,000

- $70,000; - $70,000

$5,000;- $70,000

$5,000; $5,000