103 567
Assignments Done
98.5%
Successfully Done
In November 2021

# Answer to Question #58087 in Microeconomics for Katie

Question #58087
Farmer Mcdonald gives banjo lessons for $20 an hour. One day, instead of giving banjo lessons, he spends 10 hours planting$100 worth of seeds on his farm. The seeds yield crops that he can sell for $200. What are the accounting costs, economic costs, accounting profit, and economic profit associated with growing crops? 1 Expert's answer 2016-03-09T08:36:42-0500 Accounting cost is monetary value of resources used in performing an activity. In our case it is the worth of seeds -$100.
Economic cost differs from accounting cost because it includes opportunity cost. In our case opportunity cost is $20per hourÃ—10hours=$200. So economic cost is $100+$200=$300. Accounting profit is consists of revenue minus explicit costs:$200-$100=-$100.
Economic profit consists of revenue minus implicit (opportunity) and explicit (monetary) costs:
$200-$300=-100$(loss) Answer$100; $300;$100; -100\$ (loss)

Need a fast expert's response?

Submit order

and get a quick answer at the best price

for any assignment or question with DETAILED EXPLANATIONS!

Assignment Expert
03.12.18, 15:37

Dear Mariyam Zehra, You're welcome. We are glad to be helpful. If you liked our service please press like-button beside answer field. Thank you!

Mariyam Zehra
30.11.18, 11:17

Well explained